Where in turbotax should I enter graduate fellowship income? University didn't issue a 1099-MISC/W-2, and 1098-T only includes fellowship used for tuition.

Forum|Forum|6 years ago
March 3, 2020
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TurboTax Deluxe Online

NCPERSON1

there is a section for misc income.....

andrewpdupuisAuthor

But there's also a section for scholarship/fellowships. Depending on where the number is entered, my tax liability changes by over 5000 bucks. Figured it would be worth asking.......

Opus 17

Employee

It shouldn't change if you do it right.

A graduate fellowship is not self-employment income, you are a student in training, not a business person trying to make a profit. If you entered the income as "other uncommon income" and answered the testing questions correctly, it would show up as "other income" and you would not be charged self employment tax.

However, the correct way to enter the income is to use the Education expense interview on the deductions and credits page. After entering the 1098-T (this should not be taxable, if the stipend just equals your tuition), keep going, and there should be additional questions about scholarships and fellowships. Your stipend is not subject to social security or medicare tax or self-employment tax but it is subject to regular income tax.

Also worth noting, that because this is not income earned from working, it is not "earned income" and does not qualify you for EIC, or certain other tax provisions that require earned income. Reporting it incorrectly as self-employment income might make you appear eligible for those credits. So entering the income the wrong way could create a swing in either the plus or minus direction, depending on SE tax vs. credits. But the correct answer is to enter it as a taxable scholarship or fellowship that is more than your qualified tuition expenses.

NCPERSON1

sorry - I should have read your entire question.

what did you use the money for? if the fellowship was used for tuition, it is non-taxable.

what is in Box 1 and Box 5 of form 1098T?

DawnC

Employee

As Champ Opus 17 explains above - Any amount of fellowship you received in excess of your qualified education expenses should be reported as taxable income on your tax return. You can add the amount that was not reported on a W-2, 1099, or 1098-T as additional scholarship income when you enter your education expenses. This way it will be reported on Line 1 (Wages) with a SCH notation on your Form 1040. Although, as stated above, it is not considered earned income.

See IRS topic - how to report taxable scholarships and fellowships.

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Hal_Al

Employee

Why did you not get a 1099-Misc, W-2 or the fellowship was not included in box 5 of your 1098-T. That is unusual, what's going on here?

One possible explanation is that it is classified as tuition waiver or reduction, available to graduate student research and teaching assistants, and which is not taxable. See: https://www.aau.edu/sites/default/files/AAU%20Files/Key%20Issues/Taxation%20%26%20Finance/Section-117-d-Qualified-Tuition-Reduction-FINAL.pdf

Opus 17

Employee

I think some colleges struggle with proper reporting. Stipends for graduate students in excess of the tuition waiver should probably be reported in box 5 of the 1098–T, but I have also seen them reported in box 3 of 1099–MISC. This is also not the first person to post on this forum (or the old forum) who didn’t get any forms at all.

andrewpdupuisAuthor

I saw some of the prior posts, but was struggling with how to access the correct field in which to enter this in the newest turbotax user interface, since it didn't match a "form". Thanks y'all for helping me figure it out.