3 answers
Hayley
Student
Weeki Wachee, Florida
2
Questions
Asked
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Taxable Scholarships
#accounting
If I win any of the scholarships I'm applying for are they taxable to me
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3 answers
Angelica Rossana Tolentino
Global Mobility Services at PwC
15
Answers
Los Angeles, California
Updated
Angelica Rossana’s Answer
Hi Hayley,
Generally, scholarships are not taxable as long as they are used to cover qualified education expenses. In the case that the scholarship amount is more than your qualified education expenses, that excess amount may be taxable as income.
Please refer to the IRS Publication 970 (especially page 5) for more details: https://www.irs.gov/pub/irs-pdf/p970.pdf
Generally, scholarships are not taxable as long as they are used to cover qualified education expenses. In the case that the scholarship amount is more than your qualified education expenses, that excess amount may be taxable as income.
Please refer to the IRS Publication 970 (especially page 5) for more details: https://www.irs.gov/pub/irs-pdf/p970.pdf
Brandan Rainey, MBA
Experienced Associate at PwC
1
Answer
Los Angeles, California
Updated
Brandan’s Answer
Hello Hayley,
Thank you for your question.
Your scholarship may or may not be taxable. Generally speaking, a scholarship or fellowship is tax free if you are a degree candidate and the award is used to pay for tuition and required fees, books, supplies and equipment, however there are some scholarship and fellowship opportunities that are not tax exempt. Any amounts used to pay for room and board and a stipend for living expenses is taxable. There are also a variety of coordination restrictions that are intended to ensure that you don't double-dip when taking advantage of the Education Tax Benefits.
Thank you for your question.
Your scholarship may or may not be taxable. Generally speaking, a scholarship or fellowship is tax free if you are a degree candidate and the award is used to pay for tuition and required fees, books, supplies and equipment, however there are some scholarship and fellowship opportunities that are not tax exempt. Any amounts used to pay for room and board and a stipend for living expenses is taxable. There are also a variety of coordination restrictions that are intended to ensure that you don't double-dip when taking advantage of the Education Tax Benefits.
Rachel Lyle
PwC Tax Associate
27
Answers
Updated
Rachel’s Answer
Scholarships are nontaxable so long as they are used to pay for qualifying educational expenses such as tuition.