1997 Tax Help Archives  

Scholarship and Fellowship Grants

This is archived information that pertains only to the 1997 Tax Year. If you
are looking for information for the current tax year, go to the Tax Prep Help Area.

If you receive a scholarship or fellowship grant, all or part of the amounts you receive may be tax-free.

Qualified scholarships and fellowship grants are treated as tax-free amounts if all the following conditions are met:

  1. You are a candidate for a degree at an educational institution,
  2. Amounts you receive as a scholarship or fellowship are used for tuition and fees required for enrollment or attendance at the educational institution, or for books, supplies, and equipment required for courses of instruction; and
  3. The amounts received are not a payment for your services.

Included in gross income are amounts used for expenses, such as room and board, incidental travel, equipment, as well as amounts received as payments for teaching, research, or other services required as a condition for receiving the scholarship or fellowship grant.

If any part of your scholarship or fellowship grant is taxable, you may have to make estimated tax payments. See Topic 355 for additional information.

For more information, order Publication 520, Scholarships and Fellowships, by calling 1-800-829-3676.

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