Please note that this post was published for tax year 2015. For a full and updated guide on using TurboTax® as a graduate student, go here.
Entering undocumented fellowship income into TurboTax is slightly unintuitive, but the steps below will show you how.
1. Under the ‘Federal Taxes’ and ‘Deductions & Credits’ tab, press ‘Continue.’
2. On the ‘Let’s check for tax breaks’ page, select ‘Jump to the full list.’ Scroll down to ‘Education’ and press ‘Show more.’ Select ‘Start’ for ‘Expenses and Scholarships (Form 1098-T).’
3. Counter-intuitively, to enter undocumented fellowship income, select ‘Yes’ on the section regarding higher education expenses.
4. Enter your proper personal information on the next three screens.
5. To enter undocumented fellowship income, say that you did not receive a 1098-T (but if you did receive one for other scholarship and fellowship information, say yes and enter the information from the form).
By default, universities are supposed to issue each student a 1098-T. TurboTax wants you to verify that you qualify for an exception to that rule. The most likely reason that a grad student receiving a stipend would not receive a 1098-T is that he had more scholarship/fellowship income than qualified education expenses.
6. Click through the next several screens, entering your proper information. (I’m skipping the expenses section for now because I’m focusing on the fellowship stipend income. However, if you have any relevant education expenses you should enter them at this point at this point.)
7. Finally, we arrive at the Scholarships and Financial Aid page – click ‘Continue.’
8. On the next screen, say ‘Yes,’ enter the amount of your undocumented fellowship/scholarship information under ‘Other Scholarships/Grants/Fellowships,’ and press ‘Continue.’
9. Enter your proper information on the next screen.
10. Next, TurboTax asks what you used this fellowship/scholarship information for. The hypothetical grad student didn’t pay room and board, etc. with this fellowship, so his answer is ‘No.’ If you did, just enter your information here. (For what it’s worth, I also answered ‘Yes’ at this stage to test it out, and it didn’t affect the outcome.)
11. Enter your proper information on the next three screens.
12. Next, TurboTax gives you the option to enter the information for another student.
13. TurboTax concludes that you can’t claim an education deduction or credit, which is what we expected as our intention was to report additional income.
Check: Under tabs ‘My Account’ and ‘Tools,’ click ‘View Tax Summary’ and then ‘Preview My 1040’ to verify that the income you entered was added to the correct line on your tax return.
Parent post: Grad Student TurboTax Guide: 2016 Edition
We at Grad Student Finances are not tax professionals, and none of the content in this section should be taken as advice for tax purposes.
Free Tax Webinar for Grad Students and Postdocs
Emily Roberts presented a tax webinar for funded grad students and postdocs (US domestic) on March 9, 2018.
Register for the webinar to receive a replay!