I'm an undergrad who received a taxable fellowship grant (not from my school). How do I report this as income on my 1040 in TurboTax without a W-2 or 1099-NEC?

[home_owner]

I am an undergrad student who received a taxable fellowship grant - stipend paid for the work I did (this was not from my university). From what I understand, this must be reported as income on my 1040. There was no W-2 or 1099-NEC issued. How do I enter this in TurboTax to report it as earned income? If I enter under the education 1098-T in expenses and credits than I don't see this amount as earned income.

[KrisD15]

Yes, enter the amount of the Fellowship Grant in the Education Section under Deductions & Credits in TurboTax. Enter as "Other Scholarships/Grants/Fellowships.

The amount will flow to Schedule 1 line 8r.

(Enter under

Deductions & Credits

Education

Expenses and Scholarships (Form 1098-T)

Continue through the interview and enter the 1098-T if you have one, if not just ignore the screens asking about Form 1098-T and continue until you get to the "Did you Receive a Scholarship or Grant in (XXXX Tax Year)"

This income is treated as earned in some ways, such as affecting the earned Income Credit and ability to contribute to an IRA, but does not require Self-Employment tax which is FICA tax (Social Security contribution).

According to the IRS:

"How you report any taxable scholarship or fellowship grant income depends on which return you file. Form 1040 or 1040-SR. If you file Form 1040 or 1040-SR, include any taxable amount reported to you in box 1 of Form W-2 in the total on line 1a. Include any taxable amount not reported to you in box 1 of Form W-2 on Schedule 1 (Form 1040), line 8r."
 

and

"Note. Whether you will benefit from applying a scholarship or fellowship grant to nonqualified expenses will depend on the amount of the student's qualified education expenses, the amount of the scholarship or fellowship grant, and whether the scholarship or fellowship grant may (by its terms) be used for nonqualified expenses. Any benefit will also depend on the student's federal and state marginal tax rates as well as any federal and state tax credits the student claims. Before deciding, look at the total amount of your federal and state tax refunds or taxes owed and, if the student is your dependent, the student's tax refunds or taxes owed. For example, if you are the student and you also claim the earned income credit, choosing to apply a scholarship or fellowship grant to nonqualified expenses by including the amount in your income may not benefit you if the decrease to your earned income credit as a result of including the scholarship or fellowship grant in income is more than the increase to your lifetime learning credit as a result of including this amount in income.         

and

“Individual retirement arrangements (IRAs). You can set up and make contributions to an IRA if you receive taxable compensation. A scholarship or fellowship grant is generally taxable compensation only if it is shown in box 1 of your Form W-2, Wage and Tax Statement. However, for tax years beginning after 2019, certain non-tuition fellowship and stipend payments not reported to you on Form W-2 are treated as taxable compensation for IRA purposes.”
 

[home_owner]

Thank you. The 1098-T was issued by my school and I’m entering it in TurboTax. The Fellowship grant came from another entity, which paid a stipend but did not issue a W-2 or 1099-NEC. I want to report it as earned income to contribute to an IRA. I followed your instructions and entered the grant in the 1098-T section, but on TurboTax, it’s not showing as earned income. 

[KrisD15]

To clarify, is the amount of the grant you're entering showing on Schedule 1 line 8r?

HERE is how to view Schedule 1 of your return if using online. (It's part of the 1040 tax return) 

(Desktop users simply switch to Forms located on the top right)