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ashukla79
Nov 5, 2009, 05:18 PM
Hi Folks,
I came to US in August 2003 and I have been filing regular taxes. For 2007 and 2008 I was on a scholarship. I got my W2 for 2007 and I filled my taxes. However, although I have been regularly paid, I never got any W2 for 2008. When I asked university pay roll they said you will not get any W2 as you were on scholarship and hence not on the pay roll. Moreover, since this is your 6th year on F1 you are not supposed to pay taxes.
I am very much confused, what to do. Can anyone please help me out.
Thanks a lot
- Abhi
AtlantaTaxExpert
Nov 6, 2009, 08:53 AM
Abhi:

Scholarships are NOT automatically taxable income. If the scholarship covers only tuition, fees, books, supplies and equipment needed for the courses at the university, then it is completely tax-free.

If it also covers the cost of room and board, the room and board portion of the scholarship is taxable income.

Also, if you are required to work as a condition of the scholarship, then a part of the scholarship is considered earned income and is subject to income taxes.

More detailed information can be foudn in IRS Pub 970, which can be downloaded from Internal Revenue Service (http://www.irs.gov).