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    substud Posts: 1, Reputation: 1
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    #1

    Mar 4, 2008, 07:37 AM
    Sign-On Bonus/ 1099- Scholarship
    Hello!

    I need to know what you guys advise me doing? (perhaps seeking legal advice)

    But, I took a job as a pharmacist at a local hospital. I actually took the job before I finished my grad schooling/rotations.

    They had offered me a 20k sign on bonus, however it was never referred to as a sign on bonus. All the paper work referred to it as sometype of scholarship.
    And when I was with HR prior to taking the job, I was told I wouldn't be taxed on it.

    Well, now the hospital filed a 1099 for me, for the entire 20k. And I am suppose to pay tax for this. I DO NOT have that kind of money for one.

    Two, I feel this is the employeers fault, however with them being a big hospital they are not really helping their employees. It also looks like a couple of us are in the same boat.


    I wouldn't have had a problem with them taxing it before I got the money.

    I guess my question is what do you recommend I do? How can I cut this money down?? Or eliminate having to to somehow come up with all the money to pay taxes on this...


    I am in need of serious help ! Thank you in advance
    ebaines's Avatar
    ebaines Posts: 12,131, Reputation: 1307
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    #2

    Mar 4, 2008, 10:14 AM
    Grants that are made to cover tuition and fees or required books for school, and without expectation of the student performing a particular service would be untaxed. But stipends for things like living expenses and food are taxable, as is money from the university that is given to a student in exchange for a service. So since this money was in exchange for your working at the pharmacy, it would be taxable. See the following tax tip:

    Tax Topics - Topic 421 Scholarship and Fellowship Grants

    If you are unable to pay the tax bill due by April, contact the IRS to work out a repayment plan.

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