Lots of students and teachers are paid what is called a stipend. these payments invariably show up on 1099-MISC box 7 "non-employee" compensation. As I understand it this income is not subject to SE tax. Can't really find and answer as to how this income is entered without the IRS looking for SE tax. Any suggestions.
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Here is some information on it:
"Grants given to students, trainees, or researchers which require the performance of personal services as a necessary condition for disbursing the grant do not qualify as scholarship or fellowship grants. Instead, they are compensation for personal services considered to be wages. It does not matter what term is used to describe the grant (for example, stipend, scholarship, fellowship, etc.)."
From what I have read it is taxable if services were provided.
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The question.....
..... is > is it subject to SE tax and how do you say No?
I still don't know the answer but making the entry on line 21, my program asks is it subject to SE tax > Y/N.Last edited by BOB W; 01-11-2007, 08:34 AM.This post is for discussion purposes only and should be verified with other sources before actual use.
Many times I post additional info on the post, Click on "message board" for updated content.
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I guess it depends on the amount. I did some research on google and entered " stipend IRS". Lots of pages came up from universities stating it was taxable as wages. So it would taxed as SE. But I don't think I have seen a 1099 given for a stipend that had box 7 marked. It is usually the other income box.
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