Final answer:
The statement that only the taxable portion of a scholarship is considered when determining the gross income test for dependency status is false. All income that is not exempt from tax is included in the gross income calculations for dependency tests.
Step-by-step explanation:
In determining whether the gross income test is met for determining dependency status, it is false that only the taxable portion of a scholarship is considered. This is because the Internal Revenue Service (IRS) specifies that certain non-taxable portions of income, such as a portion of the scholarship that is used for expenses other than tuition and books, may be included in gross income calculations for dependency tests. When assessing the dependent status as part of the qualifying relative tests, the person’s gross income must be less than the year's exemption amount, and it includes all income that is not exempt from tax.