How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask rramsook Your Own Question

rramsook
rramsook, Enrolled Agent
Category: Tax
Satisfied Customers: 304
Experience:  Specialize in Individual,Corporate, and payroll tax matters.
62036424
Type Your Tax Question Here...
rramsook is online now
A new question is answered every 9 seconds

RR hg

Customer Question

Hi! This is kind of a long question, but I am wondering about paying taxes on Pell Grants. It was explained to me that you ONLY had to pay tax on Pell Grant monies received that were OVER your qualified tuition and related expense cost. (IE, School cost $4000, but you rcv $4500 in PG, then you would pay tax on the $500) Anyway, my husband's school included the total amount of grants received on the 1098T they sent us. Do I have to claim that entire amount, or only what was over his school expenses?
Submitted: 2 years ago.
Category: Tax
Expert:  rramsook replied 2 years ago.

rramsook :

Hello, In order to figure out the amount you have to claim you will have to take the tuition expense on form 1098-T and subtract the amount of grants you received. The net amount will be the number that you will report on your tax return.

Customer :

That doesn't make any sense to me....the amount listed in box 2 is less than $300, and his expenses were well over $8000. It's like they used his loan money instead of Grant money to pay for tuition/fees

rramsook :

If your tuition is more than your scholarship and grants amounts then you do not have to pay taxes on the grants. To report the tuition costs for the deduction you will have to take your tuition cost less grants and scholarships received.

Customer :

Right, I get that. I just don't want to get in trouble with the IRS, because the amounts listed on the 1098T completely screw me tax-wise, when his tuition/fees were between $8-10K for two semesters, and they have only a couple hundred listed on the form, and then all the grants listed so we have to pay taxes on it, when we should be able to count that towards tuition, etc., as long as it is under the amount paid. Does what I'm saying make sense?

rramsook :

so your saying that his grants were more than whats listed on the form?

Customer :

no, the grant amount listed is correct, but Box 2, which lists "amounts billed for qualified tuition and related expenses" is WRONG, by several thousand dollars. Do we just have to subtract the difference ourselves, and enter that in the amount for scholarships/grants, or do you have to pay tax on it regardless?

rramsook :

You will have to contact your institution to notify them of the error because a copy of that 1098-T went to the IRS, so if your numbers on your return doesn't match what the IRS has on file that will cause a problem. I recommend you contact your school and have them fix the error and issue and amended 1098-T showing the correct amounts.

JustAnswer in the News:

 
 
 
Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.
 
 
 

What Customers are Saying:

 
 
 
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
< Last | Next >
  • I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response... T.G.W Matteson, IL
  • I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight. Bonnie Chesnee, SC
  • Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation. John Minneapolis, MN
  • Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with. Orville Hesperia, California
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C. Freshfield, Liverpool, UK
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex Los Angeles, CA
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP Hesperia, CA
 
 
 

Meet The Experts:

 
 
 
  • Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
< Last | Next >
  • http://ww2.justanswer.com/uploads/KU/KUMI95/2013-9-30_195031_kumar.64x64.jpg Wallstreet Esq.'s Avatar

    Wallstreet Esq.

    Tax Attorney

    Satisfied Customers:

    570
    10 years experience
  • http://ww2.justanswer.com/uploads/CU/Cuttinggirl/2011-10-29_03719_wcrop2.64x64.jpg Wendy Reed's Avatar

    Wendy Reed

    Enrolled Agent

    Satisfied Customers:

    3052
    15+ years tax preparation and tax advice.
  • http://ww2.justanswer.com/uploads/CATax/2009-08-04_204548_Mark.jpg Mark D's Avatar

    Mark D

    Enrolled Agent

    Satisfied Customers:

    985
    MBA, EA, Specializing in Business and Individual Tax Returns and Issues
  • http://ww2.justanswer.com/uploads/IN/insearchoftheanswer/2013-8-16_0233_attorney.64x64.jpg Richard's Avatar

    Richard

    Tax Attorney

    Satisfied Customers:

    3229
    29 years of experience as a tax, real estate, and business attorney.
  • http://ww2.justanswer.com/uploads/MY/MyVirtualCPA/2012-7-5_44024_cookmegan1.64x64.jpg Megan C's Avatar

    Megan C

    Certified Public Accountant (CPA)

    Satisfied Customers:

    6121
    Licensed CPA, CFE, CMA who teaches accounting courses at Master's Level
  • http://ww2.justanswer.com/uploads/JG/jgordosea/2012-6-7_43138_GordosVeritas.64x64.jpg jgordosea's Avatar

    jgordosea

    Enrolled Agent

    Satisfied Customers:

    2783
    I've prepared all types of taxes since 1987.
  • http://ww2.justanswer.com/uploads/OZ/ozaukeecpa/2012-6-7_193219_Picture1croppedandshrunk.64x64.jpg MequonCPA's Avatar

    MequonCPA

    Certified Public Accountant (CPA)

    Satisfied Customers:

    2231
    CPA, Over 30 yrs experience w/individuals and small businesses. Masters in Tax.
 
 
 
Chat Now With A Tax Professional
rramsook
rramsook
President/Owner
280 Satisfied Customers
Specialize in Individual,Corporate, and payroll tax matters.