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pat789
Returning Member

Roth IRA contribution penalty and 1098-T fellowship income

1098-T scholarship income was included in line 1 on previous years' 1040 form. For tax year 2022, it is reported in a new income category, box 8r, of Schedule 1. This seems to have caused TT not to recognize the income is qualified for IRA contribution, per GSSA (graduate student savings act) passed in 2019.

 

When will TT resolve this issue? Please help!

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1 Reply
Cynthiad66
Expert Alumni

Roth IRA contribution penalty and 1098-T fellowship income

Our expert, SamS1, came up with this work around.  Let's try this.  It is cumbersome but usually works.

 

To report stipend income in TurboTax, you must visit Deductions and Credits, Education Expenses section. You must answer all the questions, the taxable amount will be computed as the excess of your scholarship over the qualified education expenses.

  1. Federal Taxes
  2. Deduction & Credits  
  3. Scroll down to Education
  4. Select Expenses and Scholarships
  5. Follow the prompts… It will be somewhat confusing as you are answering the questions as if you claim an education credit… answer the initial questions and select that you did not receive form 1098-T. You will be asked for school’s name and address, just fill out the program information you are in... You will eventually see a screen "Did (your name) receive a scholarship or grant in 2022? Please enter your stipend in other Scholarships/Grants/Fellowships; this will ensure that the stipend is taxable on line 7 form 1040 as wages.

Once done, you may review your form 1040 and to verify that line 7 of the form looks correct.  You may do so prior to paying for the program:

  1. From My Account drop down, select Tools (you must be logged into your tax return)
  2. Select View Tax Summary
  3. Select Preview my 1040
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