4 ms·

Yes but those can and do vary in their tax status, with some just treated as a source of your stipend compensation (i.e. W-2). The government doesn't really kn

Yes but those can and do vary in their tax status, with some just treated as a source of your stipend compensation (i.e. W-2). The government doesn't really know about when you were paid though, so you're unlikely to get hit with penalties if you do forget to pay the estimated tax.

mbreese 10y ago
They don't vary in the taxable status. Any[1] income you receive is taxable. The IRS doesn't care if it is a "fellowship", a "stipend", or "wages" - or if your school considers you a student or an employee - if you got income, it needs to be reported. And if you don't get a W2 (and withholding), it is a big pain to deal with the estimated taxes. You only get leeway for failing to pay estimated taxes for your first year. After that, you're supposed to know that you owe taxes and can (and will) be hit with penalties. The timing issues only come into play with "seasonal" or farm work... for these purposes, the IRS will assume you're paid on a regular basis, and thus owe estimated taxes on a regular basis. It makes it really fun when you and your spouse are both grad students, and have to deal with that twice. [1] Okay, not everything, but for the purposes of this discussion, yes.
- tanderson92 10y ago
  Yes, they do. Bizarrely, I know of two people with an NSF GRF at different institutions, one who receives a W-2 and one who does not. They both receive departmental "fellowships". There is more to "tax status" than whether you must pay income tax. There are payroll taxes, Roth IRA-eligibility, etc.
  - maxerickson 10y ago
    It can still be taxable income without a W-2.
    - tanderson92 10y ago
      Agreed! That is not in dispute. The question is whether tax status of income is wholly determined by whether the income is considered "taxable income". In the bizarro world of the IRS, the answer is no !
  - cozzyd 10y ago
    Yes, I believe generally full-time students are exempt from payroll taxes when paid by the same institution they are students at.
  - mbreese 10y ago
    I've been on fellowships where I got a W2 (and taxes withheld), and others where I was paid a stipend and I had to pay estimated taxes myself. My point is - just because a "fellowship" income is not reported via a W2 doesn't mean one doesn't have to pay taxes on it. But, it's all taxable income as far as the IRS is concerned.
    - tanderson92 10y ago
      Yes, but my larger point here was that "taxable income" ==/==> "taxable compensation". That is, there is strictly more to "tax status" of income than whether it is taxable income. For more, read Pub 970. It's really quite complicated than whether you pay taxes on the income or not.
- dragonwriter 10y ago
  > They don't vary in the taxable status. Any[1] income you receive is taxable Not all graduate stipend (fellowship, etc.) income is taxable, but the part that comes from work (as well as any amount not used for certain purposes, even if it doesn't come from work) done as a condition of the stipend (fellowship, etc.) is taxable: https://www.irs.gov/taxtopics/tc421.html https://www.irs.gov/taxtopics/tc421.html
sldivzklhc 10y ago
I had a grant-funded summer internship at a military institute. They gave me a 1099, with all the money filled in to a box that indicated I didn't owe tax. Got hit with self-employment taxes and a penalty two years after. Pretty sure I fit the requirements for W2 and they should have paid but I'm not about to report the military to the IRS or sue them.
- dnautics 10y ago
  > I'm not about to report the military to the IRS or sue them. Suing them is not a good idea, but why not report them? It's not like retribution will come your way and it could be interesting, if not better (as in "less contradictory") for future people in your position.

mbreese 10y ago

They don't vary in the taxable status. Any[1] income you receive is taxable. The IRS doesn't care if it is a "fellowship", a "stipend", or "wages" - or if your school considers you a student or an employee - if you got income, it needs to be reported. And if you don't get a W2 (and withholding), it is a big pain to deal with the estimated taxes. You only get leeway for failing to pay estimated taxes for your first year. After that, you're supposed to know that you owe taxes and can (and will) be hit with penalties. The timing issues only come into play with "seasonal" or farm work... for these purposes, the IRS will assume you're paid on a regular basis, and thus owe estimated taxes on a regular basis. It makes it really fun when you and your spouse are both grad students, and have to deal with that twice. [1] Okay, not everything, but for the purposes of this discussion, yes.

tanderson92 10y ago
Yes, they do. Bizarrely, I know of two people with an NSF GRF at different institutions, one who receives a W-2 and one who does not. They both receive departmental "fellowships". There is more to "tax status" than whether you must pay income tax. There are payroll taxes, Roth IRA-eligibility, etc.
- maxerickson 10y ago
  It can still be taxable income without a W-2.
  - tanderson92 10y ago
    Agreed! That is not in dispute. The question is whether tax status of income is wholly determined by whether the income is considered "taxable income". In the bizarro world of the IRS, the answer is no !
- cozzyd 10y ago
  Yes, I believe generally full-time students are exempt from payroll taxes when paid by the same institution they are students at.
- mbreese 10y ago
  I've been on fellowships where I got a W2 (and taxes withheld), and others where I was paid a stipend and I had to pay estimated taxes myself. My point is - just because a "fellowship" income is not reported via a W2 doesn't mean one doesn't have to pay taxes on it. But, it's all taxable income as far as the IRS is concerned.
  - tanderson92 10y ago
    Yes, but my larger point here was that "taxable income" ==/==> "taxable compensation". That is, there is strictly more to "tax status" of income than whether it is taxable income. For more, read Pub 970. It's really quite complicated than whether you pay taxes on the income or not.
dragonwriter 10y ago
> They don't vary in the taxable status. Any[1] income you receive is taxable Not all graduate stipend (fellowship, etc.) income is taxable, but the part that comes from work (as well as any amount not used for certain purposes, even if it doesn't come from work) done as a condition of the stipend (fellowship, etc.) is taxable: https://www.irs.gov/taxtopics/tc421.html https://www.irs.gov/taxtopics/tc421.html

sldivzklhc 10y ago

I had a grant-funded summer internship at a military institute. They gave me a 1099, with all the money filled in to a box that indicated I didn't owe tax. Got hit with self-employment taxes and a penalty two years after. Pretty sure I fit the requirements for W2 and they should have paid but I'm not about to report the military to the IRS or sue them.

dnautics 10y ago
> I'm not about to report the military to the IRS or sue them. Suing them is not a good idea, but why not report them? It's not like retribution will come your way and it could be interesting, if not better (as in "less contradictory") for future people in your position.