Graduate Student Tuition Remission

[jcqlnmartinez5]

I am a graduate student and receive tuition remission from the university for being a teaching assistant. Would this be considered taxable income?  

[KrisD15]

According to the IRS:

"A tuition reduction you receive for graduate education is qualified, and therefore tax free, if both of the following requirements are met.

• It is provided by an eligible educational institution.

• You are a graduate student who performs teaching or research activities for the educational institution."

If the remission is considered taxable, it should be included in Box 1 of your W-2. 

[jcqlnmartinez5]

Thank you for the response! I would like to get a bit more clarification on "If the remission is considered taxable, it should be included in Box 1 of your W-2". I received a 1098-T with information in box 1 and 5 how would I know if those amounts would be taxable? 

[KatrinaB48]

Since it was reported on Form 1098-T it is not taxable. It would have been reported on a W-2 for if it was.

[jcqlnmartinez5]

This was helpful! After I enter the amounts from 1098-T in the respective boxes, it asks a question that I am having a bit difficulty responding to. The question asks "Tell us if the scholarship amount from box 5 of your 1098-T includes any of the following: GI Bill benefits, Veterans' benefits, Tax-free employer provided assistance" would I be able to put the entire amount of box 5 as I am technically an employee of the university as a teaching assistant? How would I account for the tuition remission? Any assistance that you can provide would be greatly appreciated! 

[LinaJ2020]

The "GI Bill benefits, Veterans' benefits, Tax-free employer-provided assistance" are for the tax-free or pre-tax benefit income sources.  If you are an employer of the university, your income is not tax-free unless you participate in their employer-provided assistance program.  You would enter zero for that question.

@jcqlnmartinez5

[Erinopera]

My son finished his Masters last spring, and is now a PhD candidate.  As a PhD candidate, his tuition is fully covered.  He received his 1098-t from the school for his Master’s program, but did NOT receive a 1098-t from the PhD program since everything was covered. Since he doesn’t have the 2nd 1098-t, should he say he attended 1 or 2 institutions?  He doesn’t have the taxID info, etc for the 2nd school.  He would also have to say he did not receive a 1098-t as there was nothing paid.  What’s the correct way to handle this? 

[DaveF1006]

Just report the 1098T he received for the masters program. The only reason why he would receive a 1098T for his PHD program is if he received scholarship money or other reportable income from he school since his school expenses are already covered.

You may wish to check with his PHD institution, to see if there is a reporting requirement that should have made that may have been missed. 

Since, he did not receive a 1098T, he can say he only attended one institution, for now.  If this changes, then he may file an amended return to reflect the change just in case there is a reporting requirement regarding his PHD activity in the second institution just in case if it was missed.

@Erinopera 

[Erinopera]

Thanks so much!  Really appreciate it your prompt response.  He did reach out to them, and they said he wouldn’t receive anything, so I will go ahead with your advice:-)