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Quick Guide to Graduate Student Tax Information

Did you...

Receive a Fellowship Award
in 2017?

 

You may receive an electronic 1098‐T from www.1098‐T.com informing you of fellowship information that was reported to the IRS.

 

The Internal Revenue Service (IRS) and the California Franchise Tax Board (FTB) consider graduate fellowships/scholarships taxable income for all graduate students.

The amount of fellowship/scholarship used to pay “qualified educational expenses” is exempt from Federal and State income tax. These include:

  • Tuition and fees (including course required fees)
  • Text books purchased from the campus bookstore

The amount of fellowship/scholarship used to pay “nonqualified expenses” may be subject to Federal and State income tax. These include:

  • Cash or cash equivalents paid directly to the recipient of fellowship/scholarship income.
  • Housing
  • Transportation & Parking
  • Meals & Entertainment

U.S. citizens, U.S. permanent residents, asylees, and/or refugees do not have income tax withholding requirements on their fellowship/scholarship awards. Instead, they must make quarterly estimated tax payments to the IRS and FTB, as needed.

Nonresident aliens receiving nonqualified fellowship/scholarship payments will have federal income tax withheld from the payment.

 

Questions about tax liability for fellowships/scholarships? Please contact Tax Services at tax@ucmerced.edu.


 

Receive Compensation Through UC Merced Employment in 2017?

 

You may receive a W-­2 from the University of California system informing you of what compensation was reported to the IRS.

 

Salary received for performing services, such as teaching and research, is not included in the “fellowship/scholarship” category.

If you elected for an electronic W-2, an automated notification will be sent to your email address once it is available on At Your Service Online (AYSO).

If you elected for paper W-2, it is scheduled to be mailed/post marked by January 31, 2018 to your mailing address on file in the Payroll System.

Visit At Your Service Online (AYSO) to sign up for electronic W-2 or update your mailing address on file.

 

Questions about your W-­2? Please contact Payroll Services at payroll@ucmerced.edu.

 

 

 

 

 

 

 

 

 

 


 

NOTE: This information is not intended as a substitute for professional tax counseling or for reading relevant Internal Revenue Service and California Franchise Tax Board publications.