Posted on 01/24/2011 10:20:08 AM PST by GQuagmire
Does financial aid count as reportable income to the parents of a college student?
It’s a loan, not income.
Update: some aid, some grants
http://www.irs.gov/publications/p970/ch01.html#en_US_publink1000177987
So, while I have no answer to your question, I try to flag the very real dangers about willy nilly college debt to everyone.
All the best to your child, though!
We made sure the costs when she’s done aren’t ridiculous.
She’s not going to an Ivy League school.
This potential tax liability is a surprise if hold up to be true, but in the grand scheme of things it won’t be a dealbreaker.
Thank you for the kind wishes to my daughter!
In general the above advice is, to the best of my knowledge, correct. When you file your returns, there are some tax credits available. If you declare the student (who then cannot declare herself) there may be limitations on the tax credits depending on the actual situation. You’ll need to read carefully. This is pretty minor stuff compared to what would happen if grants counted as income.
Good luck to your college student.
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