Jilly (21) is a full-time undergraduate student pursuing an accounting degree at her state university. During the year, she received a $6,000, unrestricted scholarship, reported to her on Form 1098-T rather than Form W-2. Jilly spent $5,000 of the scholarship funds on her current-year tuition, and she applied the rest to room and board. She also had income from a part-time job, and she is required to file a 2021 tax return. How should Jilly report the scholarship income on her Form 1040?

a) None of Jilly's scholarship is included in her taxable income or reported on her return.

b) She should include this in the amount she reports for wages, salaries, tips, etc. by entering $1,000 on line 1 of her Form 1040 and writing "SCH" on the dotted line next to it.

c) She should report this as additional income from gains by entering $1,000 on line 4 of Schedule 1, Additional Income and Adjustments to Income, and write "SCH" on the dotted line next to it.

d) She should report this as additional other income by entering $6,000 on line 8z of Schedule 1, Additional Income and Adjustments to Income, and writing "SCH" on the dotted line next to it.