FAQs for U.S. Citizens & Permanent Residents Receiving Swarthmore Scholarship

FAQ:s Taxable Scholarship and Filing Your Taxes

What do I do first?

Determine whether or not you have taxable scholarship and if you need to schedule an appointment with the Financial Aid Office.

How do I determine if I have taxable Scholarship?

  • First gather all of the 2014 tax-related documents needed to determine if you are required to file:
    • W-2 Income Statement(s) and or 1099 Interest Statements: Your employer(s) must send you a statement of 2014 wages earned and taxes withheld (Form W-2 or Form 1099). Contact your employer if you do not receive your 2014 W-2 by early February. If you lose your W-2, ask your employer for a new one.
      1099-INT: You will receive a 1099-INT from your bank if you earned sufficient reportable interest on an interest bearing checking or savings account.
    • Swarthmore Financial Aid Award Letters, outside scholarship award notices, and any 2014 service, enrichment, or summer stipend grant amounts for academic year 13-14 and 14-15: The tax year straddles two academic years. You must know the scholarship amount received spring '14 (13-14 academic year) & fall '14 (14-15 academic year).
      Lang, Evans, Mellon or Swarthmore Foundation special grants: If awarded a 2013 service, enrichment, or summer stipend grant not reflected on a W-2 Statement, record the amount you received (spring '13 term, summer of 2013 & fall '13 term).
  • Use our taxable scholarship worksheet  to determine your taxable scholarship

Am I required to file a 2014 federal income tax return?

You must file a 2014 return if certain minimum income levels are met. Remember the "VERY IMPORTANT NOTICE" on the previous page. If you fit that profile you must file a return if any of the following apply:

  • You have 2014 earned income over $6,200. Earned income includes wages and tips (reported on W-2, Box 1), and taxable scholarship (use our scholarship worksheet to determine if you have taxable scholarship).
  • You have 2014 unearned income over $1000. Unearned income includes interest earned on a savings or checking account. You will receive Form 1099-INT from your bank if you have 2014 reportable interest.
  • Your gross income (earned + unearned + unemployment compensation + Alaska Permanent Fund dividends) is more than the larger of:
    1. $1000
    2. earned income (up to $5,850) plus $350.
  • If your income falls below all of the above levels, you are not required to file. However, if federal tax was withheld from your wages (Box 2 of your W-2), you are due a refund - you want to file!

Which tax form should I use, and where can I find complete information about how to prepare it?

  • Most Swarthmore students will use 2014 Form 1040EZ, the simplest of the federal income tax return forms. Use this form if your taxable income is less than $100,000, and your income is only from wages, tips, scholarship, unemployment compensation, Alaska Permanent Fund dividends, and taxable interest of $1,500 or less.
  • Use either Form 1040A or Form 1040 if you cannot use Form 1040EZ. Use the links below or download them from the Internal Revenue Service (http://www.irs.gov/Forms-&-Pubs):

What if I had more than one employer during 2014?

You will receive a W-2 income statement from each employer. Do not file a separate return for each job. The amount that you enter on Line 1 of the 1040EZ should include all wages from all employers. This also applies to other sources of income. For instance, if you received interest from more than one bank during 2014, total all of the interest received for the year, and list it on Line 2 of the 1040EZ form.

Does the federal government really expect me to pay income tax on scholarships/grants?

Students receive scholarships/fellowships/grants/stipends/waivers from various sources. Regardless of the term used, the taxability of scholarship depends on its nature: Scholarship which covers tuition, fees, and required books is not taxable if there is no requirement to perform services for the scholarship.Scholarship which covers room and board is taxable.Scholarship awarded for research, good-works, enrichment, counseling, or any other service, regardless if used to pay tuition, is taxable income.

Determine your taxable scholarship using our worksheet. Swarthmore will pay the federal tax arising from your Swarthmore need-based, not-for-service scholarship if you desire assistance. This help is only offered through March 15, 2015.  Sign up for a tax appointmentwith the tax desk on our website, to get your credit and/or check to the IRS processed.

When is the deadline for filing my federal income tax return?

The 2014 federal income tax return must be postmarked by April 15, not necessarily received at the IRS by that date. Returns filed by means other than the U.S. mail (i.e., by e-file or telephone) must also be filed by April 15, 2015. If you file after this date, you may have to pay penalties and interest.

If I owe tax, to whom do I make the check payable?

Make your check payable to the United States Treasury. Make sure your name, address, phone # and social security # are on the check face and write "2014 Form 1040-EZ" in the memo section.

Should I keep a copy of my return?

Absolutely! And keep a copy of all attachments, such as your W-2. It may be necessary to refer to a previous year's tax return or to produce evidence that you submitted a tax return. You should keep copies of your tax returns for seven years.

Do I need to file a Pennsylvania State Income Tax form?

If you earned more than $33 in Pennsylvania in 2014 you must file a Pennsylvania state tax return. Your Pennsylvania taxable income includes only wages you earned in Pennsylvania. It does not include interest or dividends that you received in 2014. Also, Pennsylvania does not tax scholarship. Form PA-40 and its instruction booklet can be downloaded at: http://www.revenue.state.pa.us(select "forms and publications"; "forms for individuals"; "personal income tax"). If you worked in another state, or if your permanent address is in a state other than Pennsylvania you may be required to file a state income tax return with that state. Check with the tax department of the state you worked/live in.

Next academic year I plan to attend a spring '16 study abroad program. I won't be in the U.S. when it's time to file my 2015 federal tax return. What can I do to make next year's tax process go smoothly?

  • Make sure that the Swarthmore payroll office (as well as any other U.S. employer) has your preferred mailing ddress to forward your W-2 statements. Make the same arrangements for any other tax related income statements. Your family can make copies and send the original tax documents to you.
  • If you receive Swarthmore scholarship, bring a copy of your 14-15 and 15-16 financial aid award letters with you for reference.
  • You can download tax forms from the IRS website or ask a friend to mail the forms to you.
  • If you receive Swarthmore scholarship which results in a tax obligation, contact the Tax Help Desk for assistance in early March ‘15 via email (finaid@swarthmore.edu).