Do You Turn in a Pell Grant on Income Taxes?
Paying for school can be expensive, and many students must apply for costly student loans in order to pay for their tuition and other expenses while they are in school. If you qualify, you can apply for a Pell Grant to help offset some of the costs. Pell Grants are treated like scholarships by the Internal Revenue Service, which can be received tax-free.
Other People Are Reading
-
Pell Grant
-
The Pell Grant is provided through a federal needs-based program that grants you money for school. Unlike a student loan, a Pell Grant does not need to be repaid in the future. As of the date of publication, the maximum you can receive is $5,500. The amount you will actually be awarded, if any, is based on your financial need.
Filing
-
As long as you use your Pell Grant money primarily for tuition and related educational expenses, the money is not taxable. If Pell Grant and other nontaxable money, such as student loans, represent your only income for the year, you will not be required to file a tax return for the year. If you have other income that requires you to file a return, you do not need to include money you received in the form of a Pell Grant on your return.
-
Educational Use
-
In most instances, any Pell Grant money you are rewarded is deposited directly with your school, which will use the money to pay for tuition and other fees. If any money is left over, your school will provide you a check. If, however, your school gives you a check for the full amount, you will need to be able to prove to the IRS that the money was used for educational expenses, so you will need to save your receipts in case you are audited.
Qualified Expenses
-
In addition to tuition and school fees, several other expenses qualify as educational expenses that can be paid with Pell Grant money, according to the Federal Student Aid website. If you are attending school at least half time, you can use your grant money to pay for room and board, school books and supplies and even transportation to and from school. You also can use the money to pay for daycare for your children as well as pay for study-abroad programs.
-
