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chasitysmithpede
New Member

I did my taxes last year and I am seeing that there is a large sum on them that I cant seem to calculate. What do I do?

Can you open last years taxes to help my understand why the wages is so large? I cant seem to find any way that the taxes are so high
7 Replies
Critter-3
Level 15

I did my taxes last year and I am seeing that there is a large sum on them that I cant seem to calculate. What do I do?

No one in this PUBLIC forum can see your returns ... so you will need to look at them yourself.  On the form 1040 line 1 the box 1 total from all your W-2 forms will be there and possibly more ... so look in the margin to the left of the total line ... do you see an amount and a 3 letter notation like SCH ? 

chasitysmithpede
New Member

I did my taxes last year and I am seeing that there is a large sum on them that I cant seem to calculate. What do I do?

@Critter-3 Yes I do see that 

Critter-3
Level 15

I did my taxes last year and I am seeing that there is a large sum on them that I cant seem to calculate. What do I do?

SCH by 1040 line 1 Wages  is  taxable scholarship income.

See FAQ
https://ttlc.intuit.com/questions/2172062-why-is-my-scholarship-taxable 

and how Turbo Tax calculates it
https://ttlc.intuit.com/questions/1901084-how-does-turbotax-calculate-line-7-form-1040-1040a-and-lin... 

Taxable scholarship is any grant or scholarship amount that exceeds qualified educational expenses (tuition, fees and for undergrads, course materials[books]). Loans are not scholarships and are never taxable

NCperson
Level 15

I did my taxes last year and I am seeing that there is a large sum on them that I cant seem to calculate. What do I do?

@Critter-3 - wow; I am impressed....how did you know that the scholarship income would be the culprit?

chasitysmithpede
New Member

I did my taxes last year and I am seeing that there is a large sum on them that I cant seem to calculate. What do I do?

@Critter-3 @Is there any way for me to fix it

VolvoGirl
Level 15

I did my taxes last year and I am seeing that there is a large sum on them that I cant seem to calculate. What do I do?

Fix what?  Do you have SCH by line 1 for Wages?  You might need to enter your school expenses.

 

SCH by 1040 line 1 Wages  is  taxable scholarship income and the amount

 

See FAQ Why is my Scholarship taxable?

https://ttlc.intuit.com/community/college-and-education/help/why-is-my-scholarship-taxable/00/26267

 

How 1040 line 1 is calculated

https://ttlc.intuit.com/community/income/help/line-1-on-my-1040-doesn-t-match-my-w-2/00/26011

 

Taxable scholarship is any grant or scholarship amount that exceeds qualified educational expenses (tuition, fees and for undergrads, course materials[books]). Loans are not scholarships and are never taxable.

NCperson
Level 15

I did my taxes last year and I am seeing that there is a large sum on them that I cant seem to calculate. What do I do?

@chasitysmithpede let me explain.   You had a 1098-T form.  In Box 5 of that form was scholarships.  In Box 1 of that form was the Qualified Educational Expenses (QEE) and I'll assume you had no other additional QEE.  

 

If the Scholarships (Box 5) exceed the Expenses (Box 1), that difference is  income to you and is added to Line 1 of Form 1040 with the designation "SCH". 

 

The way the IRS looks at it, that scholarshp money is income to you and taxable BUT to the extent the money was used on Educational Expenses, it reduces what is taxable on a dollar for dollar basis.  In your case, since the scholarship dollars (what you were given) exceeds the Expenses (what you spent). what remains is taxable to you.

 

there is nothing to fix - that is the way it works. 

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