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Graduate student taxes?

Discussion in 'Archived Threads 2001-2004' started by DonRoeber, Feb 22, 2003.

  1. DonRoeber

    DonRoeber Screenwriter

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    I've got a question about graduate student taxes. My fiancee is a full time graduate student working towards her PhD. She is paid a small stipend to cover living expenses while she's attending the unvirsity. The University pays for her tuition, and she has no student loans. The University sent her tax information on a form 1099-MISC, with her income in box 3 (used for Other Income, such as prize winnings). As far as we can tell, the University has never taken any money out of her paychecks for taxes. According to TurboTax, she owes money. We hired an accountant last year, who got confused by her taxes, and never actually filed them (something that I'm still working to have fixed). I was under the impression that a) she was below the poverty line and would be taxed, and b) wouldn't be taxed because she was a student. Does she actually owe money this year, or am I misunderstanding how the student tax laws work.
     
  2. DaveF

    DaveF Moderator
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    During my time a Ph.D. student on fellowship (finished last year), I was paid as a University employee and received a W2 each year.

    I don't believe there were any deductions for FICA and Medicare, only for State and Fed. Since the deduction level can often be set by the employee, perhaps your wife at some point chose no deductions.

    I don't understand why her income was reported on a 1099 instead of a W2. Perhaps it's some vagary of her University or the type of fellowship/stipend she is supported by.

    Do other students in her department have the same tax situation?
     
  3. MarcVH

    MarcVH Second Unit

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    You say she "received a stipend" -- do you mean wages (e.g. for a teaching assistant position ) or an award (e.g. a fellowship)? The 1099-MISC suggests the latter.

    In any case, yes, she owes taxes an it; same thing happened to me in grad school, and due to poor planning I even had to pay a penalty once. It's annoying, but being a student doesn't magically exempt you from income taxes.
    I believe she can exclude from this income costs for things she was required to get (e.g. any tuition that wasn't covered, books, etc.) if she has records.
     
  4. RobR

    RobR Second Unit

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  5. Kirk Gunn

    Kirk Gunn Screenwriter

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    Hmmmm... sounds like "I hired a defense attorney, but he got confused by the legal jargon and never showed up in court. I'm now on death row....."

    Why do I see another "lawsuit thread" in the making ?

    Good luck in your quest.
     
  6. Todd K

    Todd K Second Unit

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    When I was on fellowship in grad school, I actually got two paychecks each month -- it was split into a stipend and a salary for some reason. The stipend was not taxed, and the salary was. It is possible at least some of your fiancee's income is not taxable.
     

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