So, i had received the full amount of pell grant the 6,895 i think it was. then i received a TIP award that was worth 1400 i think. I bought a laptop with the access funds from my financial aid through my college. it went directly torwards my education on my billing i’m pretty sure. i’m getting a refund for it worth $1900 that’s going directly into my bank account. how do i report this next year? I’m very fearful of messing up my taxes. i don’t really care about all the education deductions i just want to correctly do this. I’m not sure how this works. do i put what the school puts on my Tax Form into turbotax and they do it? should i keep receipts?
Scholarships that pay for qualified educational expenses (QEE - tuition, fees, books and other course materials, including a required computer) is tax free. Scholarship amounts that exceed QEE is taxable income, on the student’s tax return.
If the $1900 is your only income, you do not need to file a tax return, as it is less than the the filing requiremnent of $12,950*.
Q. Do I put what the school puts on my Tax Form into turbotax and they do it?
A. Essentially, yes (if you need to file). But, you need to follow the interview carefully.
Q. Should i keep receipts?
A. Yes. But, if you didn't, it usually won't matter.
You maybe should care about "about all the education deductions". Even though you are on scholarship, you parents may be able to claim a tuition credit, if you are their dependent. Under certain circumstances, you as a non dependent might even be able to claim a refundable credit.
*If you have unearned income (interst, dividends, capital gain, etc), you have to file with as little as $1150 of income. For filing purposes, taxable scholarship is treated as earned income. But, your scholarship will still not sffectively be taxed.