Hey everyone. I’ve got a quick question about my taxes. I’m 28, and thus an independent student. I’m a work study, and I report my work study income on my taxes. I get the Pell Grant, the Illinois MAP Grant and the SEOG grant. Do these need to be reported anywhere specifically as income on my taxes? What about student loans? I have approximately $4000 in subsidized loans taken out currently. Do I need to report this?
Any help would be much appreciated. 
Chapter 1 of IRS Pub 970 has the details about when scholarships and grants are taxable.
http://www.irs.gov/pub/irs-pdf/p970.pdf
Essentially scholarships and grants are only taxable to the extent they exceed the cost of tuition, mandatory fees and required books and supplies. Did you receive a form 1098T in the mail or get instructions in an email from the school on how to download your 1098T? It has information relating to qualified education expenses and scholarships and grants you received in 2014.
Student loans aren’t taxable, they aren’t free money.
Thanks for the input!
I don’t have any grants or scholarships that have exceeded my cost of attendance. All of my FinAid money has gone to tuition, school expenses, etc. I didn’t get any forms from my school aside from the W2 I got for my work study. It’s sounding like I don’t have to report any of my financial aid on my taxes. I never have in previous years, but I have myself in a slightly more ‘stable’ financial position this year than I have in the last couple of years. For once my taxes are actually worth doing.
It’s not cost of attendance and it’s not school expenses, etc. that are qualified education expenses. It’s only the specific things I mentioned before. A possible reason you didn’t get a 1098T is because your scholarships and grants in 2014 did in fact exceed the cost of QEE billed by the school in 2014. Schools aren’t required to furnish a 1098T in that case. You took the time to post your question so you should probably take the time to look at your school account to make sure.
Did your grants and scholarships cover any living expenses? Are you commuting to school from home or do you have an apartment? Room and board is not a qualifying educational expense.
My grants did exceed the tuition costs/fees. I’m at a community college, and commuting from home, so I’m not currently paying rent. Would I simply report the total amount of the grants minus the amount of tuition/fees? Would that get filed under ‘other sources of income?’
By how much did your grants exceed tuition, fees and required books and supplies(if you kept receipts for those purchases) in 2014? You have to add that amount to your other income and see if you are required to file a return. Your first post says you’re already filing taxes because of work study. Since you’re 28 your parents can’t claim you as a dependent so you don’t have to file unless your income was over $10,150. You may want to file to get a refund of any withheld taxes. Have you already filed a 2014 return?
Here’s how you report any taxable scholarship/grant amount on the various tax forms.
That’s from IRS Pub 970 which was mentioned in post #1. Did you read chapter 1?