Frequently Asked Tax Questions And Answers
Keyword: Fellowships
4.8 Interest/Dividends/Other Types of Income: Grants, Scholarships, Student Loans, Work Study
I received an academic scholarship that is designated to be used
for tuition and books. Is this taxable?
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.
For additional information on Scholarship and Fellowship Grants, refer
to Tax Topic 421, and Publication 970, Tax Benefits
for Education .
References:
Can I exclude any scholarship or grant from being taxed?
If you received a scholarship or fellowship, all or part of it may be taxable,
even if you did not receive a Form W-2. Generally, the entire amount is taxable
if you are not a candidate for a degree.
If you are a candidate for a degree, you generally can exclude from income
that part of the grant used for:
Tuition and fees required for enrollment or attendance, or
Fees, books, supplies, and equipment required for your courses.
Taxable scholarships are reported on line 7 of Form 1040 (PDF) or Form 1040A (PDF) or line 1 of Form 1040EZ (PDF). If you did not receive a Form W-2, please
write "SCH" and the taxable amount to the left of the line.
References:
Can I exclude from taxable income the room and board portion of
a grant or fellowship?
No, you cannot exclude from income any part of the grant used for room
and board. A scholarship generally is an amount paid for the benefit of a
student at an educational institution to aid in the pursuit of studies. The
student may be in either a graduate or an undergraduate program. A fellowship
grant generally is an amount paid for the benefit of an individual to aid
in the pursuit of study or research. Report this amount on line 7 Form 1040 (PDF) or Form 1040A (PDF) or
line 1 of 1040EZ. If you did not receive a Form W-2, please write "SCH" and
the dollar amount to the left of the line.
References:
Do I need to report income made as a work study student at my college?
If you are enrolled in a state or local work-training program, payments
you receive as compensation for services are wages and includable in gross
income. Report these payments as wages on line 7 of Form 1040 (PDF) or Form 1040A (PDF) or line 1 of Form 1040EZ (PDF).
References:
13.6 Aliens and U.S. Citizens Living Abroad: Nonresident Alien - Students
I am a student from the People's Republic of China currently studying in
the United States. How does the income tax treaty between the U.S. and China apply,
especially for students with scholarships and fellowships?
If you are in the United States solely for the purpose of your education, training,
or obtaining special technical experience, you may be able to exclude from your income
grants or awards that you receive from a government, scientific, educational, or other
tax-exempt organization. You also may be able to exclude payments that you receive
from abroad for the purpose of your maintenance, education, study, research, or training
and up to $5,000 of income that you receive from personal services performed in the
United States. Please refer to Publication 901 , U.S. Tax Treaties,
for further details.
References:
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