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are the md/phd stipends taxed? If they are about how much do you end up with? Is this generally enough to live on in a big city? Thank you.
md/phd stipends
- Thread starter eatmyshorts
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Yes. How much stipends are taxed depends on location. Federal income tax should always be assessed. If I recall correctly (i.e. don't hold me to any of this), my overall rate is something like 12%. I'm not aware of anyone who has to pay social security and other social service taxes. Normally the self-employed has to pay self-employment tax to cover these things. But our income is considered "fellowship income" and you can read about that on the IRS site if you wish. My locale does not assess state tax on fellowship income, though some states do. My city assesses a small amount of city tax only during the PhD years. I end up with ~$2050/mo take home.
I live in the middle of a big city generally considered to be one of the more affordable cities. I think I do pretty well on that. My fairly sizable 1BR apartment in the nicest part of the city, a short walk from school, is about half of my take home pay, which leaves a pretty good chunk of change for other things.
But some things have to give. I never had a car until recently, and even then I keep it with the parents out of easy access because parking here in the city is ~$200/mo. If you lived in a more expensive city like Boston, NYC, or SF you would have a much smaller apartment (or shared), you may be more restricted on location, or you would live in student housing. But, it's always possible. They do have students after all 😀 Not all of them get parent money subsidies!!!
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I agree with Neuronix's assessment. Yes, MSTP stipends are generally taxable. I also live in a affordable city/state that is fairly big but state and city taxes bump my effective tax rate somewhere in the neighborhood of 16-18%, I think.
I've heard that the NYC schools provide subsidized housing. Not sure about other expensive cities.
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I've heard that the NYC schools provide subsidized housing. Not sure about other expensive cities.
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A couple of things to add about stipend taxes:
1) Most programs consider your stipend income non-reportable, so they will not send your pay information to the state or federal government. As it's legally written, you do owe taxes on your stipends, but you only have to report income that was not used for necessary education expenses (required textbooks, computers if required, steth, step 1 fees, etc). Subtracting out those expenses saved me a good deal of money.
2) If you expect to owe the government more than $1,000 in any given year, you should file quarterly taxes. While they won't necessarily fine you, the government is legally able to slap you with a fee for paying such a large sum all at once.
3) Talk to other students in your program, they know what's up. For example, students in my program informed me that Oregon allows you to deduct all of your room and board expenses on state taxes. Thanks to that, very few if any of us owe money on state taxes if we know to claim the credit.
4) It may not be a bad idea to take on a very part time job at some point. Every once in awhile, the government adds new tax credits that are applicable only to those with actual W2-granting employers. The money you save is worth it if the job is right.
For what it's worth, I take home about $1550/month after accounting for taxes. It's easy enough to live on that in Portland. I share a rocking 2 bedroom house with a roommate, and we each pay less than $500/month including utilities. It also helps that I'm one of the carless, Portland hippie-folk.
1) Most programs consider your stipend income non-reportable, so they will not send your pay information to the state or federal government. As it's legally written, you do owe taxes on your stipends, but you only have to report income that was not used for necessary education expenses (required textbooks, computers if required, steth, step 1 fees, etc). Subtracting out those expenses saved me a good deal of money.
2) If you expect to owe the government more than $1,000 in any given year, you should file quarterly taxes. While they won't necessarily fine you, the government is legally able to slap you with a fee for paying such a large sum all at once.
3) Talk to other students in your program, they know what's up. For example, students in my program informed me that Oregon allows you to deduct all of your room and board expenses on state taxes. Thanks to that, very few if any of us owe money on state taxes if we know to claim the credit.
4) It may not be a bad idea to take on a very part time job at some point. Every once in awhile, the government adds new tax credits that are applicable only to those with actual W2-granting employers. The money you save is worth it if the job is right.
For what it's worth, I take home about $1550/month after accounting for taxes. It's easy enough to live on that in Portland. I share a rocking 2 bedroom house with a roommate, and we each pay less than $500/month including utilities. It also helps that I'm one of the carless, Portland hippie-folk.
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