The taxpayer is a Ph.D.student in accounting at City University.The student is paid $1,500 per month for teaching two classes.The total amount received for the year is $13,500.

Question

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The $13,500 received as compensation for teaching is taxable income and should be reported on the taxpayer's tax return. Option A is incorrect because the exclusion for tuition and books only applies to qualified scholarships, which have specific eligibility requirements. Option C is incorrect because this payment is not considered a scholarship but rather compensation for services rendered. Option D is incorrect because the standard deduction and personal exemption are not relevant to determining the taxability of this income.

The Taxpayer Is a Ph