Is there free lunches?

[xiggi]

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Taxability of Scholarships
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. 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.

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<p>That statement is incomplete and misleading. </p>

<p>In general terms, scholarships are fully taxable, but subject to allowable deductions for tuition and fees required to all students in a program. Expenses for books and supplies fall into a grey area, depending the IRS guidelines one reads. </p>

<p>In the end, the taxable amount of a scholarship exceeds the cost room and board.</p>