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pressrob
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"The standard deduction for single is $6300, why is the value loaded on 1040 Line 40 less than the standard?

 
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"The standard deduction for single is $6300, why is the value loaded on 1040 Line 40 less than the standard?

Is your taxable scholarship income less than $6300?  If so, it is the interest that is lowering it because you are a dependent.


For dependents, $6300 is the Standard Deduction for earned income (from a job, but for this purpose only, taxable scholarships also count as earned income).

Standard Deduction for unearned income (such as interest) is $1050.

If you have a combination of both, it is $350 plus your earned income (up to a $6300).

See worksheet on page 39 of the Instructions for Form 1040:

https://www.irs.gov/pub/irs-pdf/i1040gi.pdf#page=39


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12 Replies

"The standard deduction for single is $6300, why is the value loaded on 1040 Line 40 less than the standard?

Are you a dependent?
If so, do you have income other than from a job or self employment (interest, dividends, capital gains, unemployment, taxable scholarships, etc.)?

Are you filing as Married Filing Separately?
pressrob
New Member

"The standard deduction for single is $6300, why is the value loaded on 1040 Line 40 less than the standard?

My parents will declare me as a dependent on their tax return.  I am a single full time student with both 1099-int and 1098t scholarship income.

"The standard deduction for single is $6300, why is the value loaded on 1040 Line 40 less than the standard?

Is your taxable scholarship income less than $6300?  If so, it is the interest that is lowering it because you are a dependent.


For dependents, $6300 is the Standard Deduction for earned income (from a job, but for this purpose only, taxable scholarships also count as earned income).

Standard Deduction for unearned income (such as interest) is $1050.

If you have a combination of both, it is $350 plus your earned income (up to a $6300).

See worksheet on page 39 of the Instructions for Form 1040:

https://www.irs.gov/pub/irs-pdf/i1040gi.pdf#page=39


3333roses
New Member

"The standard deduction for single is $6300, why is the value loaded on 1040 Line 40 less than the standard?

the turbotax software does NOT include taxable scholarships in determining the Standard deduction.  Isn't this an error in the software??

"The standard deduction for single is $6300, why is the value loaded on 1040 Line 40 less than the standard?

Can you clarify what you mean?  If you can give specific numbers, it will make it easier to understand.
3333roses
New Member

"The standard deduction for single is $6300, why is the value loaded on 1040 Line 40 less than the standard?

when calculating the standard deduction on my child's return, it calculates $1,981, which is 1,631 earned income + $350.   The $1,631 is her part time wages, and does not include taxable scholarship income of approx. $1,381, reported on line 21 of the 1040 (from 1099-Q).

"The standard deduction for single is $6300, why is the value loaded on 1040 Line 40 less than the standard?

A 1099-Q is not for scholarships, it is the distribution of a 529 plan.  That is considered as "unearned" income, and would increase the Standard Deduction like a taxable scholarship would.
3333roses
New Member

"The standard deduction for single is $6300, why is the value loaded on 1040 Line 40 less than the standard?

But the software is NOT increasing the standard deduction for this.  Is the solution to add the $1,381 (which is the taxable portion of 529 distribution) to the standard deduction calculated by the software of $1,981?

"The standard deduction for single is $6300, why is the value loaded on 1040 Line 40 less than the standard?

Sorry, I left out a very important word in my last comment.  I meant to say the unearned income would NOT increase the Standard Deduction like a taxable scholarship would.

The software is doing it correctly.

The $1381 is unearned income.  So the Standard Deduction consists of $1631 of earned income, plus $350 (for unearned income).  The total Standard Deduction should be $1981.
3333roses
New Member

"The standard deduction for single is $6300, why is the value loaded on 1040 Line 40 less than the standard?

thank you 🙂

"The standard deduction for single is $6300, why is the value loaded on 1040 Line 40 less than the standard?

You are welcome.
3333roses
New Member

"The standard deduction for single is $6300, why is the value loaded on 1040 Line 40 less than the standard?

By the way, the $350 is not tax on unearned income, rather it is a standard $350 addition for a dependent shown on "Standard deduction worksheet for Dependents".
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