Nicole is a student at USB Law School; she receives a $52,000 scholarship for 2016. Of the $52,000, $40,000 is used for tuition, $5,000 is used for books, and $7,000 is used for room and board. How much of the scholarship is excluded from taxable income for Nicole in 2016?

Question

Quizplus · Accepted Answer

The scholarship is excluded from taxable income to the extent it is used for qualified expenses, which include tuition and fees required for enrollment or attendance at an educational organization. The amount used for books and room and board is not excludable. Therefore, the amount of the scholarship that is excluded from taxable income is $40,000.

Nicole Is a Student at USB Law School; She Receives