To all recipients of scholarships and grants in 2022:
If you receive scholarship and grant aid that totals more than the cost of tuition, fees, and books in calendar year 2022, you may have taxable financial aid that should be included in your U.S. income tax return. In some cases, this may also be included in state and city income tax returns.
If you are a U.S. citizen or resident alien, whether you must file a federal income tax return depends on your gross income, your filing status, your age, and whether you are a dependent. Common filing statuses for Amherst College students are listed below in order of relevance considering the likely filing status of our student body; however, you should refer to the Internal Revenue Service website for the full listing of filing statuses. For 2022, you must file if your gross income was at least:
- Single student, who can be claimed as a dependent:
- Unearned income was over $1,150 OR
- Earned income, including wages and taxable scholarships, was over $12,950 OR
- Gross income was more than the larger of $1,150 or your earned income (up to $12,550) plus $400
- Single student, who can't be claimed as a dependent: $12,950
- Married student, filing jointly with spouse: $25,900
- Married student, filing separately from spouse: $5
The US tax laws specify that any scholarship amount received during a calendar year is not taxable if it is used to pay for tuition and fees, books, supplies, and equipment required for courses of instruction at an eligible institution. However, any remaining scholarship amount received for the same calendar year and used to pay for room and board is taxable. Emergency financial aid grants under the CARES Act for unexpected expenses, unmet financial need, or expenses related to the disruption of campus operations on account of the COVID-19 pandemic (HEERF funds), are not includible in your gross income nor your taxable scholarship amount.
If you have tax liability resulting from taxable scholarship and grant aid, we may assist you with a dean’s discretionary grant to reimburse you for taxes attributed to your scholarship and grant aid from college, federal, and state sources. Provide a copy of your tax return and any W-2 reported on your tax return to the Office of Financial Aid along with the Worksheet for Calculating Taxable Scholarship or Grants, which will help you determine the amount of taxable scholarship or grant aid you may have received in 2022. Note that the dean’s discretionary grant itself will be taxable in the following tax year. Note that the terms referred to are for the spring and fall semesters of calendar year 2022, not the fall and spring semesters of the 2022-23 academic year.
For further information, you may find IRS publication 970, Tax Benefits for Education, useful. Information, forms, and publications are also available from the IRS Web site, www.irs.gov, or by calling 800-829-3676. In addition, the IRS has a toll-free number, 800-829-1040, to provide help in completing tax returns.
To avoid delays in the process and the inconvenience of amending your tax return to make necessary corrections, please, check the following list of common errors before submitting your documentation:
- Misreporting the taxable scholarship using the 1098-T form - The information used in preparing Form 1098-T, related to tuition tax credits, is for billed tuition and scholarship and grant aid applied to your student account during calendar year 2022. You SHOULD NOT use Form 1098-T to calculate your taxable scholarship and grant aid.
- Reporting the taxable scholarship figure on the wrong line of the tax return - If you are a United States citizen or permanent resident completing an income tax return and you had taxable scholarship and grant aid, enter the amount of taxable aid to the left of the entry box for “wages, salaries, and tips” with the annotation “SCH” – for example, “SCH $5,000.” Include this amount with your wages, salaries, and tips in your entry for line 1 in Form 1040.
- Music fees not added in the calculation of the taxable portion of scholarship - If you were enrolled in music course work that required additional tuition, revise the appropriate semester’s figure to include the additional tuition.
- Omitting outside scholarships or grant aid in the calculation of the taxable portion of scholarship - You must take into consideration any scholarship or grant aid you receive from outside sources relating to the 2022 calendar year, regardless of the amount.
Additional details for international students: