Yes, you need to report the income, but not on form 8919. If this is truly stipend income, it shouldn't be reported on a 1099-MISC.
See the instructions for 1099-MISC: https://www.irs.gov/pub/irs-pdf/i1099msc.pdf (page 2). You may have already read this.
" Do not use Form 1099-MISC to report scholarship or fellowship grants. Scholarship or fellowship grants that are taxable to the recipient because they are paid for teaching, research, or other services as a condition for receiving the grant are considered wages and must be reported on Form W-2."
If you can't get the payer to correct the 1099-Misc, I would still report the income as wages, but be prepared to provide verification of your status if the IRS questions you.
- Go to Federal Taxes> Wages and Income.
- Scroll to the Less Common Income section and choose Miscellaneous Income (the last choice).
- Choose Other income not already reported on a Form W-2 or Form 1099.
- Answer Yes on the Other Wages Received screen.
- Continue past Wages Earned as a Household Employee and Sick or Disability Pay.
- Answer Yes on the Any Other Earned Income screen.
- Choose Other on the Enter Source of Other Earned Income screen.
- Enter your fellowship information on the Any Other Earned Income screen.
This will report your fellowship on line 7 of your Form 1040. You will not pay SE tax on this stipend. This payment is also not subject to Social Security or Medicare Tax (FICA) so there's no reason to file Form 8919.
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