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December
2007 As you may know, the Taxpayer Relief Act (TRA) of 1997 was adopted by Congress and the President. Among its features, it provides for two tax credits that you may be eligible to claim on your income tax return. Hope Tax Credit This is a tax credit and NOT a scholarship. According to IRS guidance, the Hope tax credit: Applies
to students enrolled in the first two years of postsecondary education.
Thus, it is not applicable to graduate or professional school students.
Applies to students enrolled at least half time for at least one
session during the calendar year. Is effective for payments made
during the calendar year. Our payment due date for the spring semester
will be January, 2008, so you can pay in December 2007 for use on
your 2007 income tax return, or pay in January 2008 and use it with
your 2008 income tax return. Lifetime Learning Tax Credit Information This is a tax credit and NOT a scholarship. According to IRS guidance, the Lifetime Learning tax credit: Applies to students who are enrolled in one or more courses at an eligible educational institution. The course or courses must be either part of a postsecondary degree program or taken by the student to acquire or improve job skills. UVA is an eligible educational institution. There are many other details surrounding the Hope and Lifetime Learing Tax Credits. We recommend that you contact your own tax professional to see if you qualify for these credits. Unfortunately, the University can not provide tax advice. You can also contact the IRS' Office of Public Liaison at 202-622-2970 or view Publication 970 on the IRS website for further information. Office
of Student Accounts Important 2007 Tax and Scholarship Information MEMORANDUM TO:
Students Receiving Scholarships and Fellowships This memorandum informs you of the possible tax implications of awards you received during calendar year 2007. Please note that tuition remissions will continue to be nontaxable and will not be reported as income to you. The 1986 Tax Reform Act rewrote Section 117 of the Internal Revenue Service (IRS) tax code to limit the exclusion of scholarships or fellowships from income to the amount used for the payment of tuition and "course required fees, books, supplies and equipment" (summarized as "course-related expenses"). Room and board are not defined as "course-related expenses". You should retain receipts for all deductible items. This provision will apply to all recipients regardless of sources of those funds. Other funds paid as a part of a scholarship or fellowship, such as stipends or living allowances, are taxable income. A description of the amount of scholarships to be reported as taxable is included in the instructions for line seven of IRS Form 1040. If
you do not know the amount of your 2007 calendar year scholarships
received or tuition and fees paid you can view your 1098T on-line
at The IRS has exempted universities from the requirements to file Form 1099 (statement of miscellaneous income) on scholarships and fellowships. Thus, while these funds may be taxable, you will not be receiving any notification from the University. The University is also not in a position to provide students with tax advice. You may want to consult the IRS or tax counsel as appropriate in the preparation of your 2007 income tax returns. You may contact the following person if you need Non-Resident Alien information: Andy Meade - (434) 924-1377 - alm3f@virginia.edu |
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