Taxable scholarships are entered on line 1 of the 1040 and can be treated as "earned income'; however, the IRS is still treating the Segal Award as "unearned income" reported on line 8.
All payments made using the Segal AmeriCorps Education Award are subject to federal tax in the year each payment is made. Additionally, payments are considered taxable income regardless of whether they are used to pay current educational costs or to repay qualified student loans, unlike scholarships which are tax-free if used for qualifying education expenses.
AmeriCorps LINK
According to the IRS:
"..., Segal AmeriCorps Education Awards are taxable in the year they're paid. If you receive an award and the payment was $600 or more during the year, you should receive a
Form 1099-MISC, Miscellaneous Income. The 1099-MISC will show the amount of the award in box 3, Other Income. There is no withholding on this payment unless you failed to provide your taxpayer identification number. Report the payment amount on the "Other income" line 8h of Schedule 1 (Form 1040) PDF and attach to Form 1040, U.S. Individual Income Tax Return or Form 1040-SR, U.S. Tax Return for Seniors, even if you don't receive Form 1099-MISC."
IRS LINK
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