Scholarship Income


B

bh2os62

If the non qualified portion of scholarships are taxable to scholarship holder, are all the athletic scholarship athletes subject to large tax bills especially if they receive a scholarship to a private college?
 
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A

Alan

If the non qualified portion of scholarships are taxable to scholarship holder, are all the athletic scholarship athletes subject to large tax bills especially if they receive a scholarship to a private college?
For purposes of whether scholarships are tax-free under Sec. 117 of the
IRC, athletic scholarships are treated no differently than any other
scholarship. As long as the scholarship funds are used to pay for
qualified educational expenses, they would be tax-free. Qualified
educational expenses do NOT include room, board, travel and any other
type of living expense. Qualified educational expenses DO include
tuition, fees, books, supplies and equipment required to either attend
the school or take a course.

The above assumes that the student meets the other requirements of the
law such as being a candidate for a degree and attending an eligible
educational institution.
 
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B

bh2os62

If the non qualified portion of scholarships are taxable to scholarship holder, are all the athletic scholarship athletes subject to large tax bills especially if they receive a scholarship to a private college?



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That's my point, with all the NCAA restrictions, how can a lot of the athletic scholarship winners pay their taxes due because of rules.
 

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