For each of the following, indicate the amount that must be included in the taxp
ID: 2419536 • Letter: F
Question
For each of the following, indicate the amount that must be included in the taxpayer's gross income: Larry was given a $1,500 tuition scholarship to attend Eastern Law School. In addition, Eastern paid Larry $4,000 per year to work part-time in the campus bookstore. Marty received a $10,000 football scholarship for attending Northern University. The scholarship covered tuition, room and board, laundry, and books. Four thousand dollars of the scholarship was designated for room and board and laundry. It was understood that Marty would participate in the school's intercollegiate football program, but Marty was not required to do so. Western School of Nursing requires all third-year students to work twenty hours per week at an affiliated hospital. Each student is paid $10 per hour. Nancy, a third-year student, earned $10,000 during the year.Explanation / Answer
Solution.
a. $1,500 Scholarship is excluded from gross income because it is use to pay tution fee, but 4,000 is included in gross income.
b. $4,000 scholarship is included in gross income because it is paying for food and housing not for tution or books. and $6,000 is excluded from gross income because it is for tution fee.
C. $10,000 can be included in gross income because it is paying for behalf of performeing a services..
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.