To communicate the distinct definition of an award and to provide guidance for departments in making payments of awards to students.
An award is different from a prize in that it is given to students when no formal application process or submission has been made to win the award. It is given to students deemed by the department to have general merit, for instance, a high GPA, or effort made by the students toward department projects.
Tax policies regarding awards
- The IRS considers awards in the same category as scholarships to students.
- Awards are not taxable as long as they are used to pay tuition, required fees, books, and equipment. They are not reportable unless the total award amount exceeds these academically related costs.
- Non-resident alien students must report scholarships and awards on form 1042-S only of the scholarship is used for non required fees such as room and board. Any award amount not used for academic costs may be withheld at 14%.
- Awards are processed through Student Accounts.
- Departments must submit award requests on a form (see forms on main page). In the section that indicated which department account should be charged, use the account code 5119 for student scholarships/awards.
- If a student has an outstanding balance on his/her account, the funds from the awards may be used to satisfy the balance.
- Any questions on this process may be addressed to Kathy Cannon, firstname.lastname@example.org.