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Lev
Lev, Tax Advisor
Category: Tax
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Experience:  Taxes, Immigration, Labor Relations
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Do grants and scholarships count as taxable income

Customer Question

Do grants and scholarships count as taxable income
Submitted: 1 year ago.
Category: Tax
Expert:  Lev replied 1 year ago.

Under some circumstances grants and scholarships MAY be classified as taxable income.

Expert:  Lev replied 1 year ago.

A scholarship or fellowship grant is tax free (excludable from gross income) only if you are a candidate for a degree at an eligible educational institution.
A scholarship or fellowship grant is tax free only to the extent:
-- It does not exceed your expenses;
-- It is not designated or earmarked for other purposes (such as room and board), and does not require (by its terms) that it cannot be used for qualified education expenses; and
-- It does not represent payment for teaching, research, or other services required as a condition for receiving the scholarship.

Following publication provides additional details.

https://www.irs.gov/pub/irs-pdf/p970.pdf

Let me know if you need any help with determination.

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