VA GI BILL book stipend

Forum|Forum|2 years ago
March 14, 2024
1 reply
0 views

For purposes of the AOTC, does the 9/11 GI bill book stipend of $1000 annually count as an additional grant/scholarship? We have the 1098 T which shows the tuition paid in 2023 and GI Bill payment in box 4 that is less than tuition total in box 1. We also have $810 in fees for books/supplies for classes. Any guidance would be appreciated as I have not yet seen information for GI Bill book stipends that are not listed on 1098 T form.

TurboTax Free Edition Online

Best answer by alimidaty

So if I understand you correctly I do not count the housing allowance for AOTC but I would put the one thousand dollar annual book stipend under other grants not listed on 1098T, is that correct?

AmyC

Employee

Sort of. The GI book stipend is not taxable and not considered a scholarship but it does count against your out of pocket expenses to reduce your AOTC credit.

About Publication 970, Tax Benefits for Education states: Example.

You have returned to college and are receiving two education benefits under the latest GI Bill: (1) a $1,534 monthly basic housing allowance (BHA) that is directly deposited to your checking account, and (2) $3,840 paid directly to your college for tuition. Neither of these benefits is taxable and you don't report them on your tax return. You also want to claim an American opportunity credit on your return. Your total tuition charges are $5,000. To figure the amount of credit, you must first subtract the $3,840 from your qualified education expenses because this payment under the GI Bill was required to be used for education expenses. You don't subtract any amount of the BHA because it was paid to you and its use wasn't restricted.

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"

alimidatyAuthorAnswer

So if I understand you correctly I do not count the housing allowance for AOTC but I would put the one thousand dollar annual book stipend under other grants not listed on 1098T, is that correct?

Hal_Al

Employee

Q. I would put the one thousand dollar annual book stipend under other grants not listed on 1098T, is that correct?

A. Yes. But, more accurately, enter under veteran's benefits. Either way, it gets treated the same. It's tax free assistance, reducing the amount eligible for the AOTC.