<p>In May of 2012, I received a $1000 tribal scholarship for graduating as Valedictorian. Today, I received a 1099-misc from the tribe. However, I'm really confused as the $1000 was listed in Box 7 (Nonemployee Compensation). I was trying to finish my taxes today to have them ready to file on Friday, but my amount owed jumped up ~$200 after adding this. Also, when I chose the 1099-misc form and chose nonemployee compensation, the next screen asked me if this income was from a business or from farming...this was just a scholarship so I don't understand how this works. After googling and researching, I have found that box 7 on the 1099-misc is for self-employed individuals reporting income. What do I do now? Do I really have to pay $200 of taxes on this?</p>
<p>You should have the tribe issue a corrected 1099-Misc. In the instructions for 1099-Misc it says “Do not use 1099-Misc for scholarship or fellowship grant.” So do your research, print it out, and go to the appropriate tribal department and ask for a correction.</p>
<p>If you received more scholarship and grant money than you paid for tuition and books, you will have taxable scholarship. But that would go on line 7 of your 1040.</p>