Your W-2 income and stipend income are both taxable. However, you must report your stipend properly or you will be liable for self-employment tax on your stipend which will increase the tax you owe.
Follow these steps to report your stipend income to ensure it is not subject to self-employment Tax:
- With TurboTax open select Wages & Income click on I'll choose what I work on
- Scroll down to Less Common Income and select Miscellaneous Income, 1099-A, 1099-C
- On the next page select Other reportable income
- On the page, Other Taxable Income enter ROTC Stipendt in the description.
This will put your stipend income on Schedule 1 Line 8 of your 1040, as required by the IRS. You will pay state and federal income tax on the amount, but it will not be subject to self-employment tax.
Review your tax situation to ensure that you are receiving any educational tax credits/deductions you may be eligible for.
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