How do I claim a grant I received because of COVID-19?

Forum|Forum|5 years ago
January 17, 2021
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TurboTax Self Employed Online

DMarkM1

Generally, speaking grants are taxable income and normally reported on a Form W2. You would enter the W2 in the Wages & Income section as Job (W2) income. If the income was reported on another form please post how the income was reported to you to get the correct steps for entering that form.

Additionally, here is a link with IRS discussion on funds received during the pandemic and their tax treatment. It appears the grants are taxable as well as loans that are forgiven.

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Hal_Al

Employee

Grant money used for qualified educational expenses (QEE - tuition, fees, books and other course materials) is tax free and does not need to be reported as income. Scholarships/grants used for living expenses, including on campus room and board are taxable.

After entering your 1098-T, in TurboTax (TT), you will encounter a subsequent screen to enter scholarships. TT will calculate the taxable portion and add the amount to line 1 of form 1040 with the notation SCH.

If you missed it,

Go through the entire education interview until you reach a screen titled "Your Education Expenses Summary". Click edit next to the student's name. That should take you to a screen “Here’s your Education Summary”. Click edit next to Scholarships.

How was the grant reported to you? W-2, 1098-T, 1099-Misc, or no tax document? If a W-2 or 1099 (unusual), do not duplicate the grant entry at the education section.