<p>My dd is a freshman. She is attending a school on a full-tuition merit scholarship. She also received some other scholarship money, so dh and I paid only a few thousand this year for the remainer of her room and board.</p>
<p>I think that dd may end up paying taxes on the scholarhsip money that goes to room and board. Is that true? (She earned around 4k this year between summer jobs and campus jobs...)</p>
<p>Also (and more importantly) -- does all the scholarship money change anything taxwise for dh and me?</p>
<p>"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."</p>
<p>It is my understanding that scholarship monies are strictly the student's tax responsibility, not the parents. However, I can't find anything that states this in black and white, so if someone knows otherwise, please speak up.</p>
<p>My son is on a full scholarship. He files his own taxes on the amount of his scholarship that goes beyond the allowable fees mentioned above. I cannot remember, but I think they get a form that gives the full amount of the scholarship. No one at the school he goes to or any of the tax guys we asked could really figure out exactly how much he should declare so we just guessed. I think your child wil have to file a tax form to declare the income.</p>