Do you report scholarships and student loans on a 1040 EZ return

[Wesley_Clark]

My sources of income last year were selling plasma, scholarships and loans. How do I report these on a 1040EZ return.

[Harriet_the_Spry]

I am not a tax person, but I did do my own taxes as a student. So hopefully this will point you in the right direction. Loans aren’t income, so they aren’t reported as income. You’ll be paying them back ;-(

I had to report my scholarships to the extent they exceeded tuition and fees (and perhaps books). So look into whether you need to report them.

No idea on the plasma. Did you get a W-2 or a 1099 from the plasma center?

Definitive results are probably on www.irs.gov

[Wesley_Clark]

Did you not report your student loans? I know they aren’t income, but are they needed anywhere on the report?

Do you need all your reciepts from college to deduct the cost of books/tuition from your scholarship money?

[hightechburrito]

I have the same question myself. My understanding is that scholarships are taxable for any portion that is not required for class. So I guess tuition, books, and lab supplies are required for class so any amount not spent on that is taxable.

Also, if you worked as a TA or anything similar, then some of that money is considered regular income and is taxable.

Here’s the two pages I found that were most helpful.

http://www.taxlinks.com/rulings/1966/revrul66-83.htm

Topic No. 421 Scholarships, Fellowship Grants, and Other Grants | Internal...

P.S. My tuition costs less than $3000 per year, and books usually don’t top $1000, but the minimum standard deduction on the 1040 EZ is something like $5000. Since that is more that I could deduct on the long form, it doesn’t make any sense to even bother with it.

I hope I am right, anyone please correct me if I am wrong.

[Lsura]

@Wesley Clark

Did you not report your student loans? I know they aren’t income, but are they needed anywhere on the report?

Do you need all your reciepts from college to deduct the cost of books/tuition from your scholarship money?

IANAA (I am not an accountant). I have never needed all my receipts from college to deduct the costs, & I never had to report my student loans anywhere. My understanding is that those are not considered income.

What the IRS has to say about grants, scholarships and student loans:

4.8 Interest/Dividends/Other Types of Income: Grants, Scholarships, Student Loans, Work Study

I received an academic scholarship that is designated to be used for tuition and books. Is this taxable?

Qualified scholarships and fellowships are treated as tax-free amounts if all of the following conditions are met:

You are a candidate for a degree at an educational institution,

Amounts you receive as a scholarship or fellowship are used for tuition and fees required for enrollment or attendance at the educational institution, or for books, supplies, and equipment required for courses of instruction, and

The amounts received are not a payment for your services.

For additional information on Scholarship and Fellowship Grants, refer to Tax Topic 421, and Publication 970, Tax Benefits for Education .

References:

* Publication 970, Tax Benefits for Education
* Tax Topic 421, Scholarship and fellowship grants

Don’t forget that there are the tuition & fees deduction, the HOPE credit or the lifetime learning credit on your tax forms as well. For these, you may have gotten a form 1098-T from your university. Mine, for example, stated that my tuition costs for 2004 were something like $6000, but all except $355 of that were waived(in my case, it was because of an assistantship). When it came to the tuition & fees deduction or the lifetime learning credit, I could only use that $355.

[Lsura]

@hightechburrito

P.S. My tuition costs less than $3000 per year, and books usually don’t top $1000, but the minimum standard deduction on the 1040 EZ is something like $5000. Since that is more that I could deduct on the long form, it doesn’t make any sense to even bother with it.

I hope I am right, anyone please correct me if I am wrong.

You can take the Hope, lifetime learning or tuition and fees deduction on top of the standard deduction - BUT you have to use form 1040 (I don’t think you can use form 1040A if you’re taking it). So, you take your standard deduction, then you go down further on the form and take an additional credit or adjustment to your income. It can make a difference in your taxes - last year my income was so low that even being a single person with no dependents, I ended up qualifying for the EIC and got back an extra $350 or so.

Form 1040 can look scary, but it’s not. Just pick one up and the instructions walk you through it.

[MsRobyn]

Can you write off the cost of textbooks?

Robin

[Lsura]

@MsRobyn

Can you write off the cost of textbooks?

Robin

Typically, I think the answer is no. But here (pdf) is the IRS publication about tax benefits for education. In some cases, books may be deductible, but not in all cases.

[zut]

@MsRobyn

Can you write off the cost of textbooks?

Robin

[Not a Qualified Tax Preparer]
It looks like the answer is “maybe”. If you check out IRS Publication 970, it outlines information on scholarships and fellowships (per the OP) as well as educational credits. You (probably) have multiple options on how you might write off educational expensese, but they all say something like:

[Q]ualified education expenses are tuition and certain related expenses required for enrollment or attendance at an eligible educational institution…

Related expenses. Student-activity fees and expenses for course-related books, supplies, and equipment are included in qualified education expenses only if the fees and expenses must be paid to the institution as a condition of enrollment or attendance. [my emphasis]

SO it looks like you can’t write off textbooks unless you are required to buy them from the University.
[/NAQTP]

[Wesley_Clark]

@hightechburrito

I have the same question myself. My understanding is that scholarships are taxable for any portion that is not required for class. So I guess tuition, books, and lab supplies are required for class so any amount not spent on that is taxable.

Also, if you worked as a TA or anything similar, then some of that money is considered regular income and is taxable.

Here’s the two pages I found that were most helpful.

http://www.taxlinks.com/rulings/1966/revrul66-83.htm
http://www.irs.gov/taxtopics/tc421.html

P.S. My tuition costs less than $3000 per year, and books usually don’t top $1000, but the minimum standard deduction on the 1040 EZ is something like $5000. Since that is more that I could deduct on the long form, it doesn’t make any sense to even bother with it.

I hope I am right, anyone please correct me if I am wrong.

I don’t get it. I got $9822 in grants and scholarships last year (so they say, but I don’t really care about that right now) and it says $8475 for qualified tuition and related expenses. So do I claim $1347 as my income? What do I use as proof that this is my income? they said they were sending another one of these to the IRS so I guess they already have the documentation.

[bump]

Scholarships aren’t taxable, except for whatever isn’t spent on tuition. So for example, if you got $5000 in scholarships and only had $3000 in tuition, you’d owe tax on $2000 of it.
One thing to keep in mind that might apply to you, is that there’s a minimum income that you need to make in order to even have to fill out a tax return, and I think it’s like $6000 bucks. Better check the IRS to make sure though.