New tax plan and tuition waiver

General Discussion for SMART Scholarship Recipients
Guest0123

New tax plan and tuition waiver

Post by Guest0123 »

Does anyone know if our tuition payments are considered a tuition waiver under the new tax plan? If so, this would mean that it is now considered taxable income (despite never receiving the money ourselves) and we will have to pay taxes on it.

CDMajor

Re: New tax plan and tuition waiver

Post by CDMajor »

Can someone clarify please? I thought this was only for graduate students.

kbl2017
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Joined: Mon May 15, 2017 10:48 pm
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Re: New tax plan and tuition waiver

Post by kbl2017 »

This is only for grad students. Since our tuition is paid for by someone we are considered a scholarship. Waivers are generally what a school does if you're working for them in exchange for free tuition i.e. TA's and RA's. While we should still worry about the many people this will hurt, it should not hurt us.

gradStudent

Re: New tax plan and tuition waiver

Post by gradStudent »

There are lots of grad students who are funded by SMART. But, no it shouldn't impact grad students who have SMART. We don't get tuition waivers, SMART pays our tuition

Guest0123

Re: New tax plan and tuition waiver

Post by Guest0123 »

Thanks for the clarification. I am a grad student so this topic has been very pressing for many in my cohort. Glad I'm safe. Sad for the rest of them though.

scheffc

Re: New tax plan and tuition waiver

Post by scheffc »

Has anyone confirmed any of this with SMART? Just because SMART pays for our tuition doesn't mean that won't be changed and added to income for tax purposes. I looked at having a private company pay for my graduate schooling and that would have happened: I would have needed to include all money paid by the company as additional income for tax filing purposes. I'm concerned the same thing could happen here.

CSMajor

Re: New tax plan and tuition waiver

Post by CSMajor »

scheffc wrote:Has anyone confirmed any of this with SMART? Just because SMART pays for our tuition doesn't mean that won't be changed and added to income for tax purposes. I looked at having a private company pay for my graduate schooling and that would have happened: I would have needed to include all money paid by the company as additional income for tax filing purposes. I'm concerned the same thing could happen here.
I would cry because then I wouldn't be able to afford living. That'd make 50% of my stipend go to taxes.

sdflldsfl

Re: New tax plan and tuition waiver

Post by sdflldsfl »

CSMajor wrote:
scheffc wrote:Has anyone confirmed any of this with SMART? Just because SMART pays for our tuition doesn't mean that won't be changed and added to income for tax purposes. I looked at having a private company pay for my graduate schooling and that would have happened: I would have needed to include all money paid by the company as additional income for tax filing purposes. I'm concerned the same thing could happen here.
I would cry because then I wouldn't be able to afford living. That'd make 50% of my stipend go to taxes.

Likely we'd be viewed as a private company paying our tuition because of the great lengths DoD goes to to not have to give us benefits, by contracting out the scholarship, and then making us "contractors" by putting everything on a 1099. I'd imagine under this new law, our tuition payments would likely go onto this 1099 rather than our universities reporting it on a 1098-T?

kbl2017
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Re: New tax plan and tuition waiver

Post by kbl2017 »

I am fairly confident this is considered a scholarship end of story....there's no waiver, the school still reports the income and pays taxes on it themselves. There is still money changing hands, which means taxes are still being paid. Waivers are like discounts, no one ever pays for them, they're not reported as income to the school etc. So a grad student at my school costs lets say $50k a year, the school waives that $50k which means it's never reported as income and is never taxed. Which I think is where the taxes issue is coming into play here.

cheapSchool

Re: New tax plan and tuition waiver

Post by cheapSchool »

50k/year?! Ouch. My grad tuition is about 8k/year and with the standard deduction being doubled, I think I'll be okay, but I feel for you all. My guess is schools will change it so that there are different tuition categories for people who would've gotten a waiver, so then they still get a waiver but it's a lot less being waived. I don't think admin at these schools are just going to say, "oh, well too bad for them." and accept a huge a subsequent decrease in enrollment/applications.

kbl2017
Posts: 339
Joined: Mon May 15, 2017 10:48 pm
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Re: New tax plan and tuition waiver

Post by kbl2017 »

cheapSchool wrote:50k/year?! Ouch. My grad tuition is about 8k/year and with the standard deduction being doubled, I think I'll be okay, but I feel for you all. My guess is schools will change it so that there are different tuition categories for people who would've gotten a waiver, so then they still get a waiver but it's a lot less being waived. I don't think admin at these schools are just going to say, "oh, well too bad for them." and accept a huge a subsequent decrease in enrollment/applications.
I think I'm overestimating a bit. It's probably more like $35k since grad school is by credit hour. However anyone undergrad at a private institution is gonna be $35k-$50k give or take a little bit. But still lol. My guess is school will have to drop their per-credit costs if this were to happen.

However, no need to worry the newest release of the tax bill doesn't seem to have anything about this tax change!

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