Should I subtract the taxable TA income on my W-2 ...
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Should I subtract the taxable TA income on my W-2 from the 1098T Box 5? (Grad student with a fellowship that requires TAing. Received both a W-2 and a 1098T.)

 
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Should I subtract the taxable TA income on my W-2 from the 1098T Box 5? (Grad student with a fellowship that requires TAing. Received both a W-2 and a 1098T.)

Yes, if the amounts on your W2 are included in Box 5 of your 1098T, you can subtract it out so that you may be able to qualify for the education credits/deductions since you must pay tax on part of the fellowship.

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Should I subtract the taxable TA income on my W-2 from the 1098T Box 5? (Grad student with a fellowship that requires TAing. Received both a W-2 and a 1098T.)

Should I subtract the taxable TA income on my W-2 from the 1098T Box 5?

No. No. No. It doesn't work that way. Enter the W-2 and the 1098-T *EXACTLY* as printed. One question you're asked in the education section is, "Did [STUDENT] receive any of the following tax free benefits last year?" and one of the listed items is "Tax free employee provided assistance". So you will select YES on that screen. Then you will enter the amount of tax free employer provided assistance, then click continue.

The next screen then asks, "Was any of {STUDENTS} financial aid already included as income?" Select YES and then enter the amount that was included in box 1 of the W-2. Then continue.

 

Here's something you need to confirm beyond any and all doubt.

Your employer should *NOT* have included the first $5,250 they paid on your behalf directly to the school in box 1 of your W-2.So I doubt they did. But when it doubt, CONFIRM IT BEYOND ANY AND ALL DOUBT or risk an audit.

If the amount is included in box 1 of your W-2, then that indicates your employer did NOT pay it directly to the school. They paid it to you. Therefore there's no way possible for it to be included in box 5 of the 1098-T if that were the case.

So if your employer screwed up and included in box 1 of your W-2 an amount they paid directly to the school, you *will* be audited on it 24-36 months down the road. So you need to gather necessary paperwork *NOW* so you can prove it when the times come. If you can't prove it, you lose. Remember the three golden rules when dealing with the IRS.

1) You are guilty until proven innocent.

2) The burden of proof lies on the accused (that's you!) and not the accuser.

3) If it's not in writing, then it flat out did not occur. Period.

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