nurse corps scholarship

[nhts290]

Hello,

I am writing because I have a scholarship and stipend from HRSA (a  federal program) under the Nurse Corps program. I know the stipend is considered taxable income in OR, but my question is:  is the scholarship (all of which goes directly to pay tuition and fees at the school I am attending) considered income I need to report in OR?  I'm just confused because my w2 included my tuition and my stipends together. The number I'm having to owe is big so I'm confused on whether I'm allowed to separate my tuition and my stipend or not so it doesn't look like I received all the money personally because majority went to the school directly

[Hal_Al]

Yes, since the scholarship is taxable on the federal return, it is also taxable on the state return. 

Because the scholarship amounts that were received as payment for services, required as a condition of the scholarship,  they are taxable income. That's why it is included on your W-2.

But, since your tuition was not paid by tax free scholarship, you can claim the tuition credit, on the federal tax return. If you are a dependent, your parent claims the tuition credit. 

References:

https://bhw.hrsa.gov/programs/nurse-corps/scholarship/apply

https://bhw.hrsa.gov/sites/default/files/bureau-health-workforce/funding/nursecorps-sp-guidance.pdf

Pub 970 (pg 6) . Generally, you can't exclude from your gross income the part of any scholarship or fellowship grant that represents payment for teaching, research, or other services required as a condition for receiving the scholarship. 

[nhts290]

hi thank you,

how can I claim claim the tuition credit, on the federal tax return. I tried applying my 1098-t but it doesn't work

[nhts290]

@Hal_Al 

How can I claim the tuition credit, on the federal tax return. It doesn't let me add my 1098-t

[Hal_Al]

In TurboTax (TT), enter at:

Federal Taxes Tab (Personal for H&B version)

Deductions & Credits

-Scroll down to:

--Education

  --Education Expenses and Scholarships (1098-T)