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My son received a tax free scholarship from my employer, is this considered "tax-free employer provided assistance"? Not sure how to answer under deductions.

Not sure if this is asking if this scholarship was from my employer or his. He is not employed, he is a full time student.
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3 Replies
maglib
Level 10

My son received a tax free scholarship from my employer, is this considered "tax-free employer provided assistance"? Not sure how to answer under deductions.

did you get any forms with the amount on it, other than a 1098-T?
If not, whoever enters the 1098-T will enter the scholarship amount.  If the scholarship actually exceeds costs though, that amount must be entered on the students return and is taxable to the extent it exceeds costs.

You enter it in the same education section under the 1098-T interview.  Search in top right 1098-T and then select jump to it in the interview to get there.

Make sure after entering all your college expenses and scholarships, you continue to the end and choose to "maximize my education credits".

Let me know if it was reported on a 1099 or other form.

**I don't work for TT. Just trying to help. All the best.
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My son received a tax free scholarship from my employer, is this considered "tax-free employer provided assistance"? Not sure how to answer under deductions.

no other forms just the 1098-T.  The question asks if the scholarship amount from box 5 of the 1098-T includes "veteran's benefits or tax free employer provided assistance", would i enter 'yes' if a portion of the amount came from my employer? The amount does not exceed the costs.
maglib
Level 10

My son received a tax free scholarship from my employer, is this considered "tax-free employer provided assistance"? Not sure how to answer under deductions.

So it is on the 1098-T, then you don't enter it elsewhere.  
Is it in box 14 of your w-2, does it show the amount?  
You only enter it there, If a student  was reimbursed by an employer, enter that reimbursement amount NOT already listed on a 1098-T, W-2 or other tax form.
When an employer reimburses an employee for education expenses, the employer may make those payments tax-free, meaning they are NOT included in the employee's wages reported in box 1 of the W2.  When the payments are tax-free, the employee/student will then use the reimbursement amount to reduce the amount of qualifying education expenses.  This is entered in TurboTax as employer-provided assistance.

If the employer includes the tuition assistance in the employee's wages, the employee/student does not reduce the education expenses by the amount of the taxed reimbursement.

I hope this helps.
**I don't work for TT. Just trying to help. All the best.
***Say "Thanks" by marking as BEST ANSWER and clicking the thumb icon in a post and that I solved your question
**Mark the post that answers your question by clicking on "Mark as Best Answer"
I am NOT an expert and you should confirm with a tax expert.

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