Graham has accepted an offer to do graduate work in the chemistry department at State University.The chemistry department offered Graham a $5,000 tuition reduction and $3,500 toward the cost of room and meals.Under the terms of the scholarship Graham must work in the chemistry labs during the summer as a research assistant.What amount must Graham include in his gross income?

Question

Quizplus · Accepted Answer

The $3,500 for room and meals is considered taxable income because it is not a qualified scholarship expense. The $5,000 tuition reduction is not included in gross income as it is a qualified scholarship expense.

Graham Has Accepted an Offer to Do Graduate Work in the Chemistry