Taxation of Financial Assistance
Scholarships and fellowships are tax exempt only if used for tuition and fees, books, supplies, and equipment required for the course of study. Scholarship recipients must be candidates for degrees.
Scholarships and fellowships are taxable if designated for purposes other than tuition and related expenses or if attributable to service performed.
Fee reductions for employee dependent graduate students must be reported as taxable income for the employee. For specific information, contact a tax preparation professional.