How should excess financial aid be reported on a tax return?

Feb 26, 2019

If the amount of financial aid, grants, or scholarships received exceeds tuition, books/supplies, room and board, etc., how do you accurately report the excess aid as earned income due to it being taxable?

Excess financial aid is reported on the same line as "wages" on your tax return. Attach an explanation to reconcile the amount since it will not be reported on a W-2 like other wages.

For more resources, check out PICPA’s Money & Life Tips, Ask a CPA, or CPA Locator.

Answered by: Paul S. Carpenter, CPA, is president of Carpenter Capital Advisors in Johnstown, Pa.

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