tax question

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tomjackson

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My AROTC son in freshman year was paid $300 per month this past fall. Did not receive 1099 or W-2. Is that because it is a "stipend" or did we miss something in the mail as far as tax form? Thank you.
 
If I'm not mistaken, the monthly stipend is not taxable. Further, W-2's are not sent out. They must be retrieved from something called "My Pay".
 
tomjackson said:
My AROTC son in freshman year was paid $300 per month this past fall. Did not receive 1099 or W-2. Is that because it is a "stipend" or did we miss something in the mail as far as tax form? Thank you.
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Yes, he did not receive this because it is a stipend and is not taxable. WooHoo!
 
His stipend is not taxable, but if he used the ROTC scholarship to pay R & B than that is.

Also beware if he does training during the summer that is not a stipend and will be taxable next year.
 
If he's getting the (non-taxable) monthly stipend, that would mean he has contracted. If he has contracted as a freshman, that would mean he was awarded a scholarship. If my assumptions are correct, I'm wondering why he didn't receive a tuition statement (Form 1098-T) from his school.
 
The 1098-T is probably an electronic document that can be accessed through the college's website - if you know where to look. And remember the 1098-T usually reflects the academic year not the calendar year, thus you must "do the math" to see if it reflects accurate information for the tax return.
 
Also book money is not taxable either. Many cadets have been very creative in how they use that money to genterate some extra spending $. Like PIMA said summer training is paid and considered taxable. For AROTC AA, AB, CULP, CIET, CLC, PROJECT GO would all fall into this catagory. Lastly some schools offer scholarships outside the ROTC program and these may or may not be taxable.
 
EDelahanty said:
If he's getting the (non-taxable) monthly stipend, that would mean he has contracted. If he has contracted as a freshman, that would mean he was awarded a scholarship. If my assumptions are correct, I'm wondering why he didn't receive a tuition statement (Form 1098-T) from his school.
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We never got one either. I always just assumed it was because we weren't paying tuition, Navy was.
 
sheriff3 said:
Lastly some schools offer scholarships outside the ROTC program and these may or may not be taxable.
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Understanding is such monies if used for room and/or board are taxable, and that is an IRS policy that should be changed. The Congress over the years has allowed the middle class to be crushed in the area of higher education, and that is a topic for itself. A little tweaking like that should not be a hard issue. Not asking for "free education at community college" or to any college, just not having to go into perpetual debt (have four children). Like most here on this forum son worked incredibly hard to get AROTC scholarship, and to expensive private school. School gave him very nice scholarship that will cover room and board but that will be a taxable event. Son also knows the AROTC is more like a loan and he will pay it back with time in service. Just saying taking care of little things can go a long way.
 
Wilco said:
Understanding is such monies if used for room and/or board are taxable, and that is an IRS policy that should be changed. The Congress over the years has allowed the middle class to be crushed in the area of higher education, and that is a topic for itself. A little tweaking like that should not be a hard issue. Not asking for "free education at community college" or to any college, just not having to go into perpetual debt (have four children). Like most here on this forum son worked incredibly hard to get AROTC scholarship, and to expensive private school. School gave him very nice scholarship that will cover room and board but that will be a taxable event. Son also knows the AROTC is more like a loan and he will pay it back with time in service. Just saying taking care of little things can go a long way.
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I don't mean to take this too far off topic, but folks without scholarships are paying income taxes on the money they use for room and board, which is in part, where I think this comes from. The other source is that folks who attend commuter schools are covering their own room and board, and whether you go to college or not you need to support yourself or have someone support you. I don't think this is a simple tweak. Any change here would need to apply to the entire population.
 
kinnem said:
We never got one either. I always just assumed it was because we weren't paying tuition, Navy was.
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Our CPA just gave me back our taxes on Friday, turns out the only piece of info we were missing was the 1098-T, once we provided I don't believe it changed anything at all and is just a pass-through document. I am usually on top of things like this but our tax code totally baffles me to the point I choose to stay ignorant and just pay a professional.
 
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