Here’s the situation: I’ve recently landed a university job that pays a stipend and also waives my tuition at said university. When tax time rolls around, will my income tax include only the money I’ve received as my stipend, or will I also be taxed for the cost of my tuition? The people I’ve asked at the university were pretty vague and have also given me conflicting answers. (As with any bureaucracy I’ve ever dealt with, it appears that 10% of the people know what they’re doing while the other 90% will make up any old answer just to get you off their back, and I haven’t been around here long enough yet to separate the competent 10% from the rest of the paper-pushers.)
I’m far from an expert, but I received tuition waivers and stipends as TA/RA in the early 80s. I recall that something was going to go into effect right after I got out of school, around 86, whereby waived tuition was going to be treated as income. Sorry my vague recollection is no clearer than that.
I’m surprised this isn’t a routine softball for your admins.
http://www.obfs.uillinois.edu/uic/payroll/taxemptnew.html
http://web.odu.edu/webroot/orgs/AF/Hr/HumanRes.nsf/files/edaidequest.pdf/$FILE/edaidequest.pdf
That wasn’t too hard - even for an old fogey like me who got his start keying Fortran onto punchcards!
So… is that a yes or a no? Both of those links look like forms one fills out and turns in to determine whether it’s taxable or not.
Thanks, loinburger, I have the exact same question.
For my graduate school, I receive a monthly stipend and don’t pay tuition. My tuition isn’t really waived - it is paid out of the research sponsorship budget.
According to my school, the stipend is taxable, but the tuition is not. Several years of tax filings this way have caused me no problems.
This is in California, if that matters.
Ah, thanks for the help. I figured (or hoped) that the reason none of the admins seemed to know the answer was that it was pretty much an automatic exemption, i.e. nobody had ever gotten their tax bill, exclaimed “What the hell is my tuition waiver doing on here?”, and raised holy hell with the admins. Still, better safe than sorry. (Or, better to raise holy hell now than later.)
On preview: I’m taking that to mean that a tuition waiver for an assistantship is exempt, Achernar.
How about this? Straight from the horse’s mouth:
You’re on your own with state tax, but I imagine your state would follow rules similar to the Fed’s.
A good rule-of-thumb is that if the university does not report the waived tuition on your W-2 as taxable income, then it is not taxable income. There are probably exceptions, but I got through grad school without IRS troubles.
Well, I was going to post that I know for certain it is tax-free, having recently been a grad student and researched the tax thing when I started paying taxes, but now I see that zut has posted a far superior factual answer with a link to the IRS and everything.
Nuts.
::kicks dirt::