Midshipman Fee Refund

WESKI · Nov 11, 2011

DS received a certified letter the other day regarding the refund of Midshipman fees from several years ago. It amounts to over $4,000! In the letter, it says that there may be tax ramifications. Any clue as how this might work? I am thinking that, as parents, we paid the fees. Since this was several years ago, we may have taken a tax credit for it. I have to check. Thus, we may have to file adjusted tax returns & pay more in taxes for years past? Or, if he deposits the funds, will it be income to him, even though it is reimbursement for fees paid? 1099 forms? Any thoughts here? We aren't involved with the parents assns anymore. Money is not in hand yet, and much as cash is nice, this could get complicated.

bugsy · Nov 11, 2011

Gatta wait to see if you get a 1099. I wouldnt act until i got formal notification of taxable amount.

jasperdog · Nov 11, 2011

WESKI said:
... I am thinking that, as parents, we paid the fees. Since this was several years ago, we may have taken a tax credit for it. I have to check. ....

If your accountant gave you similar advice as ours, then it's likely when you check you'll find you did not take a tax credit for those fees as because of the way they were described our accountant said it was hard to determine how much of the fees were tax deductable and as such it really wasn't worth taking in our case.

KP2013dramamama · Nov 12, 2011

CHECK THE EXPIRATION DATE ON THE CHECK AND GET GOING ON FIGURING OUT HOW TO TAKE CARE OF THIS. The last thing you/your ds want/s to do is lose the ability to cash the check for waiting on the accountant.

WESKI · Nov 14, 2011

Has anyone received a check/payment yet? Wondering how long it takes them to process on their end and what, exactly, you get on/with the check.

KPMum2012 · Nov 14, 2011

DD's refund was deposited in ner Navy Fed. Credit Union account about a week ago.

jasperdog · Nov 15, 2011

DS received his directly deposited into his checking account at least a week ago as well.

OldAirForce · Nov 19, 2011

We had a check arrive today. He said there was an option to actually have a check cut.

WESKI · Dec 9, 2011

For the record, direct deposit made Nov. 28, exactly 3 weeks after notification. Still wondering about 1099, but it's supposed to be a reimbursement, and as such, should not trigger a 1099 according to my accounting sources. But you never know and will have to wait until Feb. 1 or so to confirm.