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What tax form is issued for scholarships?
WantWhatsBest
98 replies12 threads Junior Member
I know we have a taxable scholarship because it’s being used for R&B. Is the 1098-T the only form a school provides, or should there be a 1099 I need to look out for? If it’s 1098-T, it’s not super clear where the scholarship is listed. It’s rolledup into another amount I think.
And since I’ve read multiple times that the 1098 T is used to figure tax credits and deductions, and I’m simply trying to report taxable portion of scholarship, my guess is that this amount is not officially singled out or reported in a separate box anywhere. And therefore I would just list it as imcome on the specified line, much like you would for cash tips if you are a waiter. Right?
38 replies And since I’ve read multiple times that the 1098 T is used to figure tax credits and deductions, and I’m simply trying to report taxable portion of scholarship, my guess is that this amount is not officially singled out or reported in a separate box anywhere. And therefore I would just list it as imcome on the specified line, much like you would for cash tips if you are a waiter. Right?
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Replies to: What tax form is issued for scholarships?
Everything you need to know is in here. Not exactly light reading but it's all there. @-)
A school is actually not required to provide the form if scholarships exceed qualified education expenses (tuition and qualified fees) received.
The 1098T can be used to figure out taxable scholarships, but you can also use your own records.
If your son had a scholarship specifically for room and board and received that scholarship in 2018, then just report that on his tax return.
Tax software will ask about education expenses and you can fill in the box 1 and box 5 of the 1098T, then where it asks how much of scholarship was used to pay for room and board, put the $1,750.
It will make that amount taxable then.
He won't owe taxes on it unless his other income plus taxable scholarships is over $12,000.
Based on the 1098T he might say only $1,100 is taxable. But you are not claiming an education tax credit so I would just report the whole room and board scholarship of $1,750 as taxable for your son.
His tax liability won't be affected by it.
@mommdc -- yep, it's the first thing I cited to him. Provided a link right on the IRS page showing scholarship used for R&B is taxable. Also sent him screen shot of the fall bill with the $1750 line item highlighted that says: scholarship/Room and board. I totally agree that this full amount should be reported. And we don't expect him to have any tax liability from it for 2018.
I still can't figure out what accounts for the additional $1100 listed for scholarship/credits total versus payments on the 1098T. That's going to gnaw at me until I can hunt it down. His fees, out of state surcharge, and tuition were all essentially credited/waived. The balance was for R&B -- $1750 of which was credited from the scholarship. The balance was paid by us. There shouldn't be any additional anything showing up on the credits side of the ledger.
I kept everything separated by tax year. The school always had the billing for spring semester posted in Dec but never posted the grants and scholarships until Jan, so the 1098 wasn't correct. i used the billing and matched up all the scholarships and all the charges. It really was a lot easier for me to keep the tax years separate and just fill in the tax software manually. I think it asked if there was a 1098 and then it asks if the 1098 is correct and I answered NO! and then filled in my own numbers from the statement.
My daughter had 5 or 6 charges: tuition, 2 fees, room (some years), board, and insurance. I added the tuition and 2 fees (plus added in her books and equipment) and that was the QEE. I then added up all her grants and scholarships (usually around 8 different items). Subtract and pay taxes on the difference. All in the same tax year.
I'm sure your tax guy doesn't know because most people don't have this situation. Even here on CC it is not that common for students to have a full ride and therefore need to pay taxes on the non-QEE amount.
If he has only that scholarship and the W2 you could do his taxes on your own.
Box 1 doesn't show the total paid, it show the total QEE expenses that were paid. QEE does not include room and board.
The 1098T reflects fall and spring. I am sure about that. I asked about it. If I add up those fees listed above (x 2 for 2 semesters) = it falls well short of the $1100 additional that's in the scholarships/grants/credits box. The housing deposit fee was refunded as part of the bill. So, I'm really just not sure what this $1100 is. I don't see why anything above that $`1750 marked for R/B would be taxable. Really confusing. I am going to hope our tax prep person can figure this out, because I sure can't. I'm going to call the school and see if I can get someone to break this down for me. When I called to ask about the 1098T last time, all they could tell me was that it included fall and spring and any other questions -- they said go talk to to your tax advisor.
Not necessarily. It's quite possible that a school is charging fees that are "a requirement to enroll" that are not considered QEE for a 529 distribution. The first thing that comes to mind is health insurance for the student that is billed by the college because the student does not have other eligible health insurance. This is not a 529 QEE.
Reflects what for fall and spring? A 2018 1098-T, in box 1, should only show amounts that were actually paid in 2018, from any source, for qualified tuition and related expenses. Trying to equate an amount in box 1 with the numbers on a billing statement is a waste of time. Anyway, the numbers that a school puts on a 1098-T are notoriously inaccurate. Don't get yourself wrapped around the axle on what the school is reporting. Rely on your own numbers for how much was paid when and for what. That's what matters.
If none of the other scholarships or grants paid for nonqualified expenses (for the purpose of the determination of tax-free scholarships and education credits that is tuition, qualified fees and books), then they are not taxable.
If the $1,750 was the only taxable scholarship, then report that.
And yes, you all have made a convincing case for me to basically disregard the 1098T and just report what I know is taxable. $1750 R&B scholarship is the only scholarship he got. So that's what we'll report.
Thanks!