Heinz and Sharon are Married Filing Jointly taxpayers. During $2022,$ they each made $$50,000$ in W$2$ wages $($total $$100,000).$ They also have a joint investment account. The investment account reported on a $1099-$DIV the payment of Ordinary dividends of $$1,200$ and qualified dividends of $$800.$ In the material attached to the $1099-$DIV, the documents reported that $$550$ of the ordinary dividends and $$400$ of the qualified dividends were from various foreign sources. It also reported foreign taxes paid of $$45.$ It will be helpful to review the instructions for form $1116.$

The couple has $4$ dependents who live with them: Wyatt $-22$ months old, Emily $7$ years old, Kate $19$ years old, and Becky $20$ years old. Kate is a Sophomore $($full$-$time student$)$ at UW$-$Whitewater. Kate$$s $1098$T from the University shows her tuition $($all paid in the current tax year$)$ was $$8,500$ and she had a scholarship of $$2,000.$ Becky is a Junior $($full$-$time student$)$ at UW$-$Whitewater. Becky$$s $1098$T from the University shows her tuition $($all paid in the current tax year$)$ was $$8,500$ and she had a scholarship of $$10,000.$ Neither Kate nor Becky have never had any trouble with the police. Becky has no other income.

The couple paid $$5,200$ for child care for Wyatt during the year, and $$400$ for Emily. It will be helpful to review the instructions for form $2441.$ If you have questions as to how many dependents to use for possible child and dependent care credit, see the $$TIP$$ under the heading $$Dollar Limit$$ on page $12$ of the $2022$ IRS publication $503$ Child and Dependent Care Expenses.

$1.$ Calculate Heinz and Sharon$$s tax credits for the year. Explain your answers. Show clearly how much of each credit is refundable and how much is non$-$refundable. $($SHOW ALL YOUR WORK FOR EACH CREDIT$).$

I asked for some help on this one. Could someone explain to me how

Kate would have qualified expenses of:

$=8500-2000($scholarship$)=6500$

Becky:

$8500-1000($Scholarship$)=7500$

Kates scholarship subtracts from what she paid into tuition but with Becky it does not. To me due to the scholarship becky should be negative paid to tuition and resulting in zero fees in Tax credit. Am I wrong in this thought process?