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Level 1

Schollarship and grants

I am a fulltime graduate student who receives a stipend each year for living expenses etc.

Jan through May 2018, my stipend was paid by the university. Taxes were withheld and all earnings for this period ($15k) were reported on a W2.

From Jun through Dec 2018, I switched to and was paid by an outside fellowship. My university does not withhold nor provide documents detailing this pay. This amount totaled $24k ($22k from outside fellowship organization and $2k bonus from my university).

Along with my pay, my university covers my tuition, fees, and healthcare premiums. This information is detailed in a 1098T they provide. The 1098T includes $52k in scholarship and $46k in qualified education expenses (the difference between the two values is my healthcare premiums and some fees, all of which are nondeductible). No portion of my pay described above is included on this 1098T.

I enter the 1098T into Turbotax. I then proceed to say “Yes” to the prompt “Let us know if you have a scholarship, grant or any of these other types of aid:”. Below this prompt, it shows my 1098T scholarship of $52k. In the “Other Scholarships/Grants/Fellowships” box I enter $24k (the value from above).

The next prompt asks, “Was any of the scholarship income not designated to pay 2018 education expenses?” I choose “Yes” and it asks “How much of the $76k received… was not designated for 2018 expense?” Here, I respond, $30k, which is the difference on my 1098T, $6k, (eg $52k minus $46k) + $24k (money earned from fellowship). Is this correct?

I hit continue and the next question is about room and board. It asks how much of the $76k was used to pay for research, travel, clerical help, or equipment. Again, I write $30k. Is this correct?

Thanks!

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Accepted Solutions
Level 8

Schollarship and grants

No, the way I read you explanation, all the scholarships were for 2018, so I don't see why you would allocate 30,000 for another year.

I think you should answer NO to “Was any of the scholarship income not designated to pay 2018 education expenses?”

Perhaps you think education expenses means tuition only, but that is not the case. 

Next, with the remaining 30,000 in Fellowships, you can allocate that to room and board. It will be taxable, which I believe in your case it should be. When the program asks how much was used to pay for research, travel, clerical help, or equipment, if you allocated the 30,000 to room and board, you're done. Don't enter the 30,000 again, but do allocate the 30,000 between room and  research, travel, clerical help, or equipment, if you used the funds for those things, in which case that potion of assistance will become tax-free. 

In other words, you paid 46,000 tuition (plus and books and/or supplies you needed to purchase which you should have entered as additional expenses. Any grants/scholarships you apply to that is tax-free. 

You also received 24,000 in assistance (don't even worry about the W2, just enter that) so allocate that (as well as the 6,000 remaining from box 5) to room and board (will be taxed) OR research, travel, clerical help, or equipment, NOT BOTH.

3 Replies
Level 8

Schollarship and grants

No, the way I read you explanation, all the scholarships were for 2018, so I don't see why you would allocate 30,000 for another year.

I think you should answer NO to “Was any of the scholarship income not designated to pay 2018 education expenses?”

Perhaps you think education expenses means tuition only, but that is not the case. 

Next, with the remaining 30,000 in Fellowships, you can allocate that to room and board. It will be taxable, which I believe in your case it should be. When the program asks how much was used to pay for research, travel, clerical help, or equipment, if you allocated the 30,000 to room and board, you're done. Don't enter the 30,000 again, but do allocate the 30,000 between room and  research, travel, clerical help, or equipment, if you used the funds for those things, in which case that potion of assistance will become tax-free. 

In other words, you paid 46,000 tuition (plus and books and/or supplies you needed to purchase which you should have entered as additional expenses. Any grants/scholarships you apply to that is tax-free. 

You also received 24,000 in assistance (don't even worry about the W2, just enter that) so allocate that (as well as the 6,000 remaining from box 5) to room and board (will be taxed) OR research, travel, clerical help, or equipment, NOT BOTH.

Level 1

Schollarship and grants

Thanks, KrisD. Where is the correct spot to enter elligible school expenses? These expenses (2,500) comes from the 30,000 of extra assistance I was receiving. If I put 2,500 in "Other Education Expenses", then do I report 30,000 or 27,500 as the "Room and Board" amount? It seems like if I report 30,000 then the other education expenses has no impact.
Level 1

Schollarship and grants

Thanks, KrisD. Where is the correct spot to enter elligible school expenses? These expenses (2,500) comes from the 30,000 of extra assistance I was receiving. If I put 2,500 in "Other Education Expenses", then do I report 30,000 or 27,500 as the "Room and Board" amount? It seems like if I report 30,000 then the other education expenses has no impact.