Do You Get a W-2 Form for a Pell Grant?
In January of each year, W-2 forms are sent out detailing any wages you earn from your job, capital gains you earned from your investments and from various other sources of income you have received over the past year. Pell grants are considered student aid and are not taxable, so you will not receive a W-2 form for any Pell Grant money you received over the previous year.
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Pell Grant Basics
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A Pell grant is a federal grant to help pay for higher education related expenses if you have been able to demonstrate to the government that you have a significant financial need. Like a scholarship, Pell grant money does not need to be paid back after you graduate.
Taxable Student Income
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Certain types of income are taxable for students. If you perform a service for pay, even if it is a work-study program on campus, your income will be taxable and you will receive a W-2 form at the beginning of the year. Self-employment and investment income are taxable as well. Finally, certain scholarships are taxable or partially taxable, according to the U.S. Internal Revenue Service.
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Nontaxable Income
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As a student, there are various sources of income you can receive that are not taxable. In addition to Pell grants, Fulbright grants are also not taxable. Education benefits from the Department of Veterans Affairs are not taxed as well, so you will not receive a W-2 form itemizing your benefit pay. Scholarship money may or may not be taxable, depending on a complicated set of factors established by the IRS.
Filing Tax Returns
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If the only money you received over the past year came from nontaxable sources, not only will you not receive a W-2 form but you also will not be required to file a tax return for the year. If you earned money from other sources that require you to file, you will not be required to report any income from nontaxable sources, including your Pell grant.
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