Did You Know That There is Financial Aid Out There For Students From Higher Education Institutions Under The CARES Act?
If you haven't heard by now, you should know that there is financial aid available for students from higher education institutions under the CARES Act. That being said, if you are a student that receives this financial aid under the CARES Act, how will this affect your taxes? Keep reading this week's blog for some important information on this very topic from the IRS. Have any questions about any of this? Please do not hesitate to call our CPA firm in Mid-MO today. We have four locations throughout Mid-MO and all of our phone numbers can be found on our website at www.WTCPA.com.
Source: https://www.irs.gov/newsroom/faqs-higher-education-emergency-relief-fund-and-emergency-financial-aid-grants-under-the-cares-act
Q1: I am a student who received an emergency financial aid grant under section 3504, 18004, or 18008 of the CARES Act for unexpected expenses, unmet financial need, or expenses related to the disruption of campus operations on account of the COVID-19 pandemic. Is this grant includible in my gross income?
A1: No. Emergency financial aid grants under the CARES Act for unexpected expenses, unmet financial need, or expenses related to the disruption of campus operations on account of the COVID-19 pandemic, such as unexpected expenses for food, housing, course materials, technology, health care, or childcare, are qualified disaster relief payments under section 139 of the Internal Revenue Code. This grant is not includible in your gross income.
Q2: I received an emergency financial aid grant under the CARES Act and used some of it to pay for course materials that are now required for online learning because my college or university campus is closed. Can I claim a tuition and fees deduction for the cost of these materials, or treat the cost of these materials as a qualifying education expense for purposes of claiming the American Opportunity Credit or the Lifetime Learning Credit?
A2: No. Because the emergency financial aid grant is not includible in your gross income, you cannot claim any deduction or credit for expenses paid with the grant including the tuition and fees deduction, the American Opportunity Credit, or the Lifetime Learning Credit. See section 139(h) of the Internal Revenue Code.
If you are having any trouble at all understanding how your taxes may be affected by what we are describing above, please do not hesitate to give our CPA firm in Central Missouri a call. We can be reached at the numbers listed below. You can also follow us on our social media channels listed below to stay up to date on our latest announcements.
Source: https://www.irs.gov/newsroom/faqs-higher-education-emergency-relief-fund-and-emergency-financial-aid-grants-under-the-cares-act
Important Information From The IRS
Q1: I am a student who received an emergency financial aid grant under section 3504, 18004, or 18008 of the CARES Act for unexpected expenses, unmet financial need, or expenses related to the disruption of campus operations on account of the COVID-19 pandemic. Is this grant includible in my gross income?
A1: No. Emergency financial aid grants under the CARES Act for unexpected expenses, unmet financial need, or expenses related to the disruption of campus operations on account of the COVID-19 pandemic, such as unexpected expenses for food, housing, course materials, technology, health care, or childcare, are qualified disaster relief payments under section 139 of the Internal Revenue Code. This grant is not includible in your gross income.
Q2: I received an emergency financial aid grant under the CARES Act and used some of it to pay for course materials that are now required for online learning because my college or university campus is closed. Can I claim a tuition and fees deduction for the cost of these materials, or treat the cost of these materials as a qualifying education expense for purposes of claiming the American Opportunity Credit or the Lifetime Learning Credit?
A2: No. Because the emergency financial aid grant is not includible in your gross income, you cannot claim any deduction or credit for expenses paid with the grant including the tuition and fees deduction, the American Opportunity Credit, or the Lifetime Learning Credit. See section 139(h) of the Internal Revenue Code.
Having Trouble Understanding How The CARES Act May Affect Your Taxes?
If you are having any trouble at all understanding how your taxes may be affected by what we are describing above, please do not hesitate to give our CPA firm in Central Missouri a call. We can be reached at the numbers listed below. You can also follow us on our social media channels listed below to stay up to date on our latest announcements.
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For tax preparation services you can count on, call:
Sedalia -- (660) 827-4990
Marshall -- (660) 886-6815
Camdenton -- (573) 346-6822
Lake Ozark -- (573) 964-5739
Check out our website: www.WTCPA.com
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