Why sign in to the Community?

  • Submit a question
  • Check your notifications
Sign in to the Community or Sign in to TurboTax and start working on your taxes
Returning Member
posted Mar 22, 2021 1:46:25 PM

1098 T

Do I need To file my taxes if I have an outside scholarship that pays for everything including room and board?

0 3 379
3 Replies
Employee Tax Expert
Mar 22, 2021 2:14:08 PM

Scholarships not used to pay for qualified education expenses (e.g. to pay for room and board) are taxable and have to be reported on your tax return.

 

If the part of your scholarships which covers room and board exceeds the standard deduction of $12,400, then you are required to file a tax return.

Returning Member
Mar 22, 2021 2:27:45 PM

Is that 12,400 for the year or a semester in college?

 

If it is more than 12,400, Does that mean I owe the government money?

 

Also, a portion of the money went to paying for books and supplies for school. 

 

Am I eligible to get a tax return if it is more than 12,400?

Level 10
Mar 22, 2021 2:59:09 PM

Your college should have sent you a Form 1098-T.

  • Box 1 on the 1098-T is the amount of your qualified expenses
  • Box 5 is the amount of your scholarships and grants.
  • If Box 1 is higher than Box 5, you do not have taxable income from the scholarship
  • If Box 5 is more than Box 1, then you have income that is taxable

If you have scholarship money left over after covering your qualified education expenses, you must include that amount as part of your gross taxable income.

That means scholarship money used to pay:

  •  Rent or board
  • Utilities
  • And other expenses (including school supplies not listed as required in your program) counts as income when calculating your tax liability

In 2020, if you are single and under age 65 and have $12,400 or more in income you are required to file a tax return.  

If you qualify, you can file your federal and state returns at no cost to you by using Free File.  If you are claimed as a dependent by a parent or any other person, you will click the box that someone else can claim you.  When you complete the tax return, you will know if you owe money to the IRS, or if you will receive a refund.

 

Qualified College Expenses