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Important Tax Information

January 29, 2016

Understanding My Tax Liability

Wisconsin Space Grant Consortium recommends the following;

Award recipients assume the responsibility for any and all income tax liabilities.  WSGC recommends that you document all expenditures, and maintain a record of all original receipts.  Please contact your tax accountant.

Reference:  Students and Taxability

Scholarship/Fellowship

Category:  *Qualified
Name of Payment:  Scholarship/Fellowship
Criteria:  Student pursuing degree and used for *Qualified expenses
Status:  Non-Taxable
Key:  Considered a resource when determining financial aid
Payee & Mail Check to:  Institution - Financial Aid Office on behalf of student
Tax Reporting:  Student institution for year-end report to IRS and student via 1098T

Scholarship/Fellowship

Category:  **Non-Qualified
Name of Payment:  Prize/Award
Criteria:  Recognition of achievement or received as result of contest entry
Status:  Taxable

Key:  Selected based on actions to enter contest, competition or proceeding
Payee & Mail Check to:  Individual
Tax Reporting:  Carthage College will report to IRS & individual; Income is self-reported

Scholarship/Fellowship

Category:  **Non-Qualified
Name of Payment:  Stipend
Criteria:  Used for **Non-qualifying expenses
Status:  Taxable

Key:  No instance involves services related to work
Payee & Mail Check to:  Individual
Tax Reporting:  No withholding/No reporting rule:  U.S. citizens no tax withholding; no reporting required if not “work”
_____________________________________________________________

*Qualified:  Tuition and fees required to enroll/attend for degree-seeking students; course related expenses such as fees, books, supplies, and equipment required for courses - must be required of all students.
**Non-qualified:  Room and board, travel, research, clerical help, equipment and other expenses that are not required for enrollment/attendance for all students; tuition and fees for non-degree seeking students.
_____________________________________________________________

Summer Stipend

Criteria:  Not enrolled; not taking courses
Status:  Taxable
Key:  No instance involves services related to work.  Student should maintain own records for taxes
Payee & Mail Check to:  Individual
Tax Reporting:  No withholding/No reporting rule:  U.S. citizens no tax withholding; no reporting required if not “work”

Reimbursement

Criteria:  Approved expenditures:  need receipts
Status:  Non-Taxable
Key:  Incur costs for approved activities; includes invoices from other institutions
Payee & Mail Check to:  Party to be reimbursed
Tax Reporting:  No reporting

Please note that all NASA awardees must be U.S. citizens. 

 

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