topic A graduate fellowship stipend that is federally taxable should not be taxed by NJ but Turbo Tax program treats as taxable by NJ. in State tax filing

A graduate fellowship stipend that is federally taxable should not be taxed by NJ but Turbo Tax program treats as taxable by NJ.

brookdavid117 — Mon, 03 Jun 2019 17:20:46 GMT

How can we fix this? Should we not use Turbo tax for NJ?

Obviously Turbo tax needs to allow for an adjustment fact...

vccase — Mon, 03 Jun 2019 17:20:47 GMT

Obviously Turbo tax needs to allow for an adjustment factor for this tax within the state of NJ.

Re: Obviously Turbo tax needs to allow for an adjustment fact...

daning — Wed, 08 Jul 2020 00:20:57 GMT

The link above is broken. Can you please fix it? Thanks!

Re: A graduate fellowship stipend that is federally taxable should not be taxed by NJ but Turbo Tax program treats as taxable by NJ.

bghogan — Thu, 29 Feb 2024 21:54:20 GMT

This is still a problem, seemingly without solution! There is even an interface in the NJ state tax section, under "Adjustments" that lists the "Other Non-Wage Income" that contains the value being erroneously ported from federal to state tax sections. However, you cannot delete the entry (it just shows up in the summary page anyway). If you could delete it here, no problem anymore, but no.

Re: A graduate fellowship stipend that is federally taxable should not be taxed by NJ but Turbo T...

AmyC — Thu, 29 Feb 2024 22:30:52 GMT

Let me help. If this fellowship income is truly nontaxable, we can remove it.

To be nontaxable, Resident Income Tax Return Instructions page 19 states:

Scholarships and Fellowship Grants. This type of income is taxable unless the scholarship or grant meets all of the following conditions: 1. The primary purpose of the grant is to further the recipient’s education or training; and 2. The grant does not represent payments for past, present, or future services that are subject to the direction or supervision of the grantor (e.g., a fellowship given in exchange for teaching); and 3. The grant is not for the benefit of the grantor

To remove it, follow these steps:

Open your NJ state return
continue to You've Finished your NJ return
Select Adjustments
You state that your fellowship shows in Other Non-
Wage Income screen
Continue to Other Non-wage income
You can't edit, you can't delete, you can add another entry
Add the same description with nontaxable and enter the negative amount

If this doesn't work for you, we can take a closer look at your program. @bghogan

Re: A graduate fellowship stipend that is federally taxable should not be taxed by NJ but Turbo T...

bstn2024 — Fri, 01 Mar 2024 04:38:50 GMT

When doing that NJ rejects the return. It cannot have a "-" sign. How do we fix that?

Re: A graduate fellowship stipend that is federally taxable should not be taxed by NJ but Turbo T...

tharpercuth — Fri, 01 Mar 2024 15:10:32 GMT

Per NJ...

"When entering "Other Income" for New Jersey, a description is required and the amount cannot be negative. Please go back and adjust your return accordingly before re-transmitting your return. However, if the problem persists, please print the return and mail it via US mail to the appropriate taxing authority."

Re: A graduate fellowship stipend that is federally taxable should not be taxed by NJ but Turbo T...

Vanessa A — Fri, 01 Mar 2024 15:35:55 GMT

This means NJ does not like the negative sign as a way to adjust your income.

So, it may be simplest to print and mail your return to NJ. You can go back to the file section and choose Print state return for mailing. Then follow the steps to print and mail the return. The mailing address will be on the instruction page printed with your return.

(Edited 3/1/24 @ 7:35AM PST)

Re: A graduate fellowship stipend that is federally taxable should not be taxed by NJ but Turbo T...

tharpercuth — Fri, 01 Mar 2024 15:30:23 GMT

The fellowship is taxable at the federal level, so it should not be deleted from the Federal return.

The only issue is the NJ income. NJ fellowships are not reported to the IRS, so there is no form to enter. It is entered as Other Income. Since NJ will not accept a negative number (or 0) to deduct the non-taxable income, it will require print and mail for the State return.

Re: A graduate fellowship stipend that is federally taxable should not be taxed by NJ but Turbo T...

livm — Fri, 29 Mar 2024 17:16:39 GMT

This is a helpful answer, but it's very frustrating that the first answer an employee tax expert gave to this question was TO enter a negative. I just wanted to add that I've also had this problem for years with TurboTax and I really hope in the future y'all will finally include a way for us to do this more easily. It affects a ton of students in Jersey, and it's a nightmare to figure out in Turbotax every year

Re: A graduate fellowship stipend that is federally taxable should not be taxed by NJ but Turbo Tax program treats as taxable by NJ.

bghogan — Sun, 19 Jan 2025 22:55:59 GMT

Hello All,

This is still a problem, I am hoping I don't have to do as I did last year and mail in my NJ state taxes separately. If only we were allowed to edit/remove entries from the NJ state income summary page for other income, there would be no problem. And note as above, negative adjustments don't seem to work.

If anyone at turbotax could chime in on this recurring problem (or better yet fix it) that would be great!

Best,

Ben

Re: A graduate fellowship stipend that is federally taxable should not be taxed by NJ but Turbo T...

AmyC — Tue, 21 Jan 2025 18:43:30 GMT

Since you can't do a negative entry, nor can you delete the income, the only options left are to use the desktop version and override the amount or to try a wage adjustment. I think an override on the desktop is the easiest and then you could e-file. How do I switch from TurboTax Online to the TurboTax software?

Re: A graduate fellowship stipend that is federally taxable should not be taxed by NJ but Turbo T...

livm — Sat, 25 Jan 2025 18:52:12 GMT

It’s pretty absurd we have to do this when it’s been a multi-year problem with TurboTax. I will be filing without TurboTax this year specifically because of this problem. I’m very disappointed it hasn’t been resolved.

Re: A graduate fellowship stipend that is federally taxable should not be taxed by NJ but Turbo Tax program treats as taxable by NJ.

SteveW4 — Fri, 28 Feb 2025 06:44:40 GMT

Is this only an issue on Desktop? I'm using Online and there's a page during the NJ income section which specifically asks if Scholarships & Fellowship info needs to be adjusted.

(It's still annoying that you can't just delete the scholarship, instead you have to at least write the Grantor Name and 0 for the Income.)

Re: A graduate fellowship stipend that is federally taxable should not be taxed by NJ but Turbo T...

AmyC — Fri, 28 Feb 2025 21:29:51 GMT

No, the issue comes from the many ways scholarships and fellowships can end up in various places based on what form or where they are entered. Yours came through perfectly. Double check that the income is being removed properly from your tax return before filing.

To see your forms:

In desktop, switch to Forms Mode.
For online, see How do I preview my TurboTax Online return before filing?

Although, it you haven't paid yet, you should do it today before the price goes up 3/1.

For online:
1. On the left side, select Tax Tools
2. Select Print center
3. Select Print, save or preview this year's return
4. If you have not paid, select pay now.

@SteveW4