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March 7, 2021
Question

Do federal/ state grants for college count as third party support?

  • March 7, 2021
  • 1 reply
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I received Pell Grant and Cal Grant awards. Do these count as third party support?

1 reply

Hal_Al
Employee
March 7, 2021

Not exactly.

Although education is a support item, a special rule provides that educational costs covered by a scholarship (or fellowship) for a dependent who is a child of the taxpayer (but not for other dependents) aren't included in the calculation of total support.

 

Reference:  https://www.waybeyondbeancounting.com/tax-treatment-of-scholarships