I was awarded money from a foundation that then transferred the money to my graduate school. The grad school applied the money towards my tuition and then gave me the rest as a stipend. Am I supposed to claim this money on my taxes or is it not taxed since it is a stipend?
Yes, your stipend is taxable, to the extent that it wasn't used for qualifying educational expenses (tuition and fees, etc). Amounts used for room and board and other living expenses are taxable.
To report this income:
- 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 (wages) of your Form 1040. You will not pay Self Employment tax on this stipend.
See the FAQ below: