It depends. If it was related to your education it is taxable based on the way it was reported to you (see the information below).
You must include in gross income:
- Amounts used for incidental expenses, such as room and board, travel, and optional equipment.
- Amounts received as payments for teaching, research, or other services required as a condition for receiving the scholarship or fellowship grant. However, you don't need to include in gross income any amounts you receive for services that are required by the National Health Service Corps Scholarship Program, the Armed Forces Health Professions Scholarship and Financial Assistance Program, or a comprehensive student work-learning-service program (as defined in section 448(e) of the Higher Education Act of 1965) operated by a work college.
Generally, you report any portion of a scholarship, a fellowship grant, or other grant that you must include in gross income as follows:
If this is in addition to your regular salary, reported on a W-2, from your same employer, then it may not be reported correctly. In this case you have two options.
- Report it as self employment.
- Report it using a substitute W-2 and the IRS will go to your employer to collect employer share of social security and medicare taxes.
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