Do I Have to Report a Student Refund?
- You are only required to report scholarships and grants if the amount awarded exceeds the cost of tuition, books, fees, class supplies and equipment needed to complete a course. To determine how much to report, subtract educational expenses from the total amount of your combined grants and scholarships. Do not subtract the amount you spend on housing, meal plans or for optional equipment.
- Loans should never be reported as income. Loans must be repaid, so they are not considered income. If you will receive scholarships, grants and loans, apply the scholarships and grants toward your tuition and required educational expenses first so you will avoid paying taxes on leftover money.
- Your college or university will send you a Form 1098-T after the first of the calendar year. The form will provide a summary of your educational costs for the previous tax year. This form should be consulted when determining your education expenses.
- If you are unsure what amount to report and how much to deduct for educational expenses, consult with a tax preparer. Make sure to keep all receipts and statements pertaining to your educational expenses.