Discussion:Scholarship
From TaxAlmanac, A Free Online Resource for Tax Professionals
Note: You are using this website at your own risk, subject to our Disclaimer and Website Use and Contribution Terms.
From TaxAlmanac
Discussion Forum Index --> Tax Questions --> Scholarship
| 8 February 2007 | |
| Client received a scholarship or grant for $14,270 on a 1098 T and the form also shows $7,867 as tuition expense. I asked how the money was spent and she said tuition. Does this mean that there could have been $6,403(14270-7867) that was spent for other items, contrary to what client says? Do I quiz her some more? Does the scholarship/grant get input any where? | |
| 8 February 2007 | |
| Perahps she spent $6,403 on books, fees, and computer equipment. | |
| 8 February 2007 | |
| Is there any remedy where a taxpayer receives a cash scholarship in 2006, but pays for the qualifying expenses (books, etc.) in 2007? | |
| 8 February 2007 | |
| What if the the client used part of the expenses for study abroad - does it make a difference or is it still considered travel and it is taxable? | |
Janakpatel (talk|edits) said: | 9 February 2007 |
| I think if it is a pell grant than you don't have to worry about taxbale income. Scholarship is a taxable income after tuition fee, books and computer equipment paid off. | |
| 9 February 2007 | |
| Qualified scholarships and fellowships are treated as tax-free amounts if all of the following conditions are met:
You are a candidate for a degree at an educational institution, Amounts you receive as a scholarship or fellowship are used for tuition and fees required for enrollment or attendance at the educational institution, or for books, supplies, and equipment required for courses of instruction, and The amounts received are not a payment for your services. See Tax Topic 421, and Publication 970, Tax Benefits for Education on the IRS Site. | |
| 9 February 2007 | |
| Okay, I had printed off the Pub 970 yesterday. I would just like to make sure that I am doing this correctly. She spent $4,509 to study abroad, to me, that is travel, so I would add that to her taxable income. Correct? | |
To join in on this discussion, you must first
log in.
