If my husband received extra non-taxed money marked as allowance for "school " , and he did not or does not go to school, is this taxable income? If so how to report?

[paulettawbf]

This money he received was added in under adjustments on his pay stubs, and was definitely NOT considered a wage or listed on his W-2. My concern is that he did NOT go to school or have education expences so can he have a tax free "allowance " for school and not pay tax on this?

[kerriP · Accepted solution]

No,  it is taxable income.  Are you certain the amounts were not included in his W-2?  I would consider talking to his employer about why the amounts were not in his W-2.  I would also inquire about a corrected W-2.  However, depending on what you find out, if you include in income I would add under miscellaneous income- UNCOMMON.

[Hal_Al]

You say it was not "listed" on his W-2.  Are you sure, it was not already include in box 1 of his W-2? If not, I agree with TurboTaxKerriP, it is taxable income and should go on line 21, of form 1040, as other income

[paulettawbf]

Can I enter this extra income on the “W-2 worksheet” where it allows me to enter an amount that should have been listed in box 8 , and wasn’t? This extra money was given to all drivers when they completed bus trips where there were no cash tips given. I would prefer to link it with his w-2 info since it was listed on his pay stubs rather then to list as misc income, not linked to his pay from this company.

[Hal_Al]

Yes.  But it would be more accurate to do something similar. After entering the W-2, you reach a screen titled “Do any of these uncommon situations apply to the W-2”. Click the box “Unreported tips”. You will have to pay social security tax on this income. TurboTax will prepare form 4137.
That works exactly the same as if the money had been in box 8 of the W-2.