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Is Your Scholarship Taxable?
Your scholarship may be taxable.
By Roxana Hadad
March 04, 2009
Congratulations! You’ve won a scholarship! You’ll want to call Mom, Dad, Grandma, Cousin Bob … and Uncle Sam. Your scholarship may count as income; if so, it will be taxed. To make sure you’re ready for tax-time, find out if your award is taxable and what you need to do to file your return.
Tax-free Scholarships and Fellowships
A scholarship is tax-free if:
• You are a full-time or part-time candidate for a degree at a primary, secondary or accredited post-secondary institution.
• The award covers tuition and fees to enroll in or attend an educational institution.
• The award covers fees, books, supplies and equipment required for your courses.
The award is tax-free only as long as you use it for the purposes outlined above.
Taxable Scholarships and Fellowships
Your scholarship is taxed if it is used to cover:
- Room and board
- Travel
- Research
- Clerical help
- Equipment
If your award, for example, covers both tuition and room and board, the amount you use for tuition is tax-free, while the amount you use for room and board is taxable. If you need to make this adjustment, you may have to adjust other parts of your return as well. For example, if you are filing a deduction for educational expenses, you must reduce the amount of your deduction by the tax-free amount of the award.
What you use your scholarship money for may determine whether you pay taxes on it.
Making It Legal: Reporting Taxable Awards
If your only income is a tax-free scholarship or fellowship, you’re in the clear. You don’t have to file a tax return or report the award. On the other hand, if all or part of your scholarship is taxable and if that money is not recorded on your W2 form, you must report it:
If you are filing a 1040EZ form, print “SCH” and the taxable amount to the right of the words “W-2 form(s)” on line 1.
For the 1040 or 1040A forms, write “SCH” and the taxable amount on the dotted line next to line 7 on the 1040 or in the space to the left of line 7 on the 1040A.
Any Questions?
If you’re not sure if your award is taxable, ask the organization that sponsored the award. They may have information from the IRS regarding your award’s tax status.
You can also seek information directly from the Internal Revenue Service. Check the IRS Web site, call the IRS help line at 1-800-829-1040, or download IRS Publication 970, which covers the tax benefits of education. If you have questions, ask as soon as possible to get your answers before tax time.
Being informed about the tax procedures for scholarships will make your life easier come April 15. Find out what’s taxable and report it correctly. You want to stay on your Uncle Sam’s good side.
doltin93
12 months ago
Good info!
DEVENPFISTER
12 months ago
Is the WUE a taxable scholarship?
Calia1
almost 2 years ago
Wow as a senior high school student i got a bunch to worry about. Housing expense, utilities and so on more. I must be in need of scholarships then.
poppyseed1
about 2 years ago
Please, I need help paying for the balance of my school. I also am on social security from a bad horserback riding accident. I never had a carreer, and persueing one in Medical coding and Billing, I allready have a certificate program, and know going for my associats degree at ctu,because I also have a 9 month old baby.My bills are behind because I had to stop work, I only had min wage jobs anyways. I want this career so bad. Pleasr help me .Thank-You Kelli Debari 860-216-2371
p95580410
about 2 years ago
I work at a University and take advantage of the employee scholarship progam. The problem is the university taxes the value of my grad school tuition and I make under 25k a year. The taxes come out on 3 biweekly paychecks and it's hard on my budget. Is this tax valid? The scholarship is for tuition only, I thought fringe benefit taxes were on the Employer not the Employee. Help?
Account Removed
over 2 years ago
I do care! Mom and Dad Dubois
Account Removed
over 2 years ago
This is a very personal dept to pay for keeping all in mind from the year approxametly 1989 - 2060 so from Lindsay Hopkins through the leap years, we have entered zone five (5) (c).
We all live on a rock in space so many rocks and one speck of dust begins the collection of items that create a planet. So much for tonights story book smarthinkers Now back to the subject at hand.
IT GO Introductory!
A serial ATA Port Multiplier is a device that allows one to connect Multiplier SATA Devices to a single SATA Host Port, in a similer manner to that of a USB hub.
USB 2.0 External bus that supports a data throughput of 480 megabits per second (Mbps). These buses are backward compatibal with buses using the orginal universal serial bus (USB) standard.
The discussion of the funtion of a USB hub.
The size of an USB hub.
The simularity of an USB hub and SATA Host Port.
A performance provided to take two systems and marry them.
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Meaning Gategory
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Architecture Computing -> Assembly
Serial ATA Computing -> Drivers
Serial the Acronym
Specialized Assult Computing -> Hardware
Tactical Androids
Student Air Travel Computing -> Conference
Association Computing -> Educational
Sponsored Events for Students.
.Locate the "Big Three (3)" Volunteering, Campus Employment, and Home Study on the Web"
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Congradulations~~~~
SUMMARY
1) What devices do you use to get data into your computer?
2) What devices do you use to get data out of your computer?
3) What's on the front of your system unit?
4) What's on the back of your system unit?
5) What's inside your system unit?
6) How do you set up your computer to avoid strain and injury?
ISBN: 0-13-240266-1 PG 68/69 MAY 10, 2060
LEEP YEAR
An input device enables you to enter your system.
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(keyboards, mouse, intell mother board, CRTs, and LCDs.
Ergonomics