Income/Taxes

  1. I just finished my taxes and to my great chagrin, I have to pay taxes on all scholarships and grants That is not the worst of it. When I fill out my FASFA, I have to put my income in as the amount that includes my grants and scholarships. So my "income" is not the $15,000 that I'd originally thought but, $27,000 This makes me eligible for less financial aid...and here we have our government screaming for education, nurses etc but yet they tax us on "free" money and include it in our income so that we don't get as much financial aid as needed! Talk about a two edged sword!!!
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  2. 4 Comments

  3. by   memphispanda
    I'm sure you have already read this, but just in case, please check out this website. I can't imagine that you would have $15000 that would qualify for taxes.

    http://www.irs.gov/taxtopics/page/0,,id%3D16213,00.html

    "Topic 421 - Scholarship and Fellowship Grants

    If you receive a scholarship or fellowship grant, all or part of the amounts you receive may be tax-free.

    Qualified scholarship and fellowship grants are treated as tax-free amounts if all 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.

    Included in gross income are amounts used for incidental expenses, such as room and board, travel, and optional equipment, as well as amounts received as payments for teaching, research, or other services required as a condition for receiving the scholarship or fellowship grant"
  4. by   essarge
    Thanks for the info! I didn't know that until I read your post. I also found that there are several online sources that will file taxes for free if your income is under a certain amount. So....taxes are in! Thanks again!
  5. by   KK7724
    I hope that I won't have to pay taxes on loans....that is sooo unfair. I need that to be able to go to school! I have a Pell Grant but it wasn't enough. Last semester with my loan and grant I still ended up paying $400 of what all of that didn't cover. Where is the break?? I am not going to school on Mommy or Daddy's money. I'm going to school and living off of my little part time job at a DME company. Who did your taxes and told you that you had to pay on all of that??
  6. by   kats
    Double check on that information. We just had our taxes done here on base and was told that grants and loans do not count. The only thing that should count is what is in box #1 of your w-2 and maybe stuff like interest or rent if you own property. Also, when I was filling out the FAFSA online, it also only asked for the income from the w-2. It didn't say anything at all about grants or loans. We are even getting a pretty big refund check and the estimated family contribution for my financial aid was $0. Good luck on figuring it out. That is why we have them done for us every year.

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