Taxes, scholarships, and reporting

Paying for College
1

<p>Okay, so what I’ve figured out so far is that I need to report the taxable portion of my scholarships (used to pay for room and board, etc) on my 1040EZ as income with “SCH” marked next to the amount. One website I encountered said that I needed to attach an explanatory letter because:</p>

<p>“IRS computers will notice the discrepancy between the amounts reported to the IRS and the wages you listed on your return. Failing to attach such a letter will likely cause your return to be audited.”</p>

<p>I haven’t heard of anyone else attaching such a letter on the threads that talked about reporting scholarship income. Is it really necessary to? I really need to know because the tax deadline is fast approaching, but I’m scared of making a mistake on the tax form and then being audited. Thanks in advance!</p>

2

<p>We didn’t attach a letter. On the return the wages etc from W2s plus the taxable scholarship amount should be written in the boxes but next to the words wages/salaries/tips write SCH and the amount of the scholarship. That is all the IRS asks for. </p>

<p>There will probably be a lot of audits if we are supposed to attach a letter!</p>

<p>edit: Hmm - it does suggest that on finaid.org We already filed and did not attach a letter. It does not say anything on the IRS web site about it being required. Will let you know if we get audited.</p>