Taxable income (fellowship) with no W-2 form

[huzrbbhho]

Hi,

In 2020 I was studying in a school outside the US. I have received a fellowship and a full-tuition waiver from the school. Therefore I have a taxable income but no W-2 form.

How can I fill it via Turbotax?

Best regards

[Hal_Al]

Do not enter at income. Instead, enter in TurboTax (TT) at:

Federal Taxes Tab (Personal for H&B version)

Deductions & Credits

-Scroll down to:

--Education

  --Education Expenses

You will eventually be asked to enter scholarships.  TT will put the amount on line 1 of form 1040 with the notation SCH.

A scholarship or fellowship grant is tax free (excludable from gross income) only if you are a candidate for a degree at an eligible educational institution and  It doesn't exceed your qualified education expenses (tuition, fees and required course materials).

The school should be able to tell you if it is an eligible educational institution. In general, an eligible educational institution is an accredited college, university, vocational school, or other postsecondary educational institution, including accredited, public, nonprofit, and proprietary (privately-owned, profit-making) postsecondary institutions. Additionally, in order to be an eligible educational institution, the school must be eligible to participate in a student aid program administered by the Department of Education. If they issue a 1098-T they are probably an eligible institution.

Enter your school at the link below, to see if it's on the dept. of education list.

https://fafsa.ed.gov/FAFSA/app/schoolSearch?locale=en_EN (choose foreign country for state)

If you need to enter tuition, you tell TT that you qualify for an exception to not having a 1098-T. 

[huzrbbhho]

Thanks for replying. 

I followed your instructions. Unfortunately, the result is incorrect.

TT outputs my 1040 Form with a mistake: It doesn't write "SCH" to mark my incomes from scholarships (see Attachment A at the end) and prints a zero total income (in line 1). In other words, TT claims that I do not have an income.

Attachment A:

According to the IRS instructions:

"[...] Scholarship and fellowship grants not reported on Form W-2. Also enter “SCH” and the amount on the dotted line next to line 1."

[Hal_Al]

Go through the entire education interview until you reach a screen titled "Your Education Expenses Summary".  Click edit next to the student's name. That should take you to a screen “Here’s your Education Summary”. Click edit next to the section you want to change; scholarships, in your case.

If you have entered scholarship that way and TT is not putting it on line 1, it  may be sensing that you used the scholarship, for tuition.  You will be asked how much of the scholarship was used for room and board.  Entered the amount that you want to be taxable there.  You did not have to have literally used the money for R&B.  Note the wording at that screen “or other expenses”. This is just the way you tell TT it was not used for qualified expenses (tuition at an eligible institution).  Tuition at a non qualified institution is other expenses.