Quantcast

Pay taxes on MSTP stipend?

This forum made possible through the generous support of SDN members, donors, and sponsors. Thank you.

CaNEM

Senior Member
10+ Year Member
15+ Year Member
Joined
Jun 12, 2002
Messages
635
Reaction score
4

Members don't see this ad.
Do you have to pay taxes on the MSTP living stipend, as if it were a salary? Or is it tax free?
 

MacGyver

Membership Revoked
Removed
15+ Year Member
Joined
Aug 9, 2001
Messages
3,757
Reaction score
5
Originally posted by CaNEM
Do you have to pay taxes on the MSTP living stipend, as if it were a salary? Or is it tax free?

i'm pretty sure it counts as taxable income
 

none

1K Member
10+ Year Member
15+ Year Member
Joined
Jul 28, 2001
Messages
1,903
Reaction score
5
Oh yes it most certainly DOES count as taxable income! And the taxes on it are usually quite complicated as schools do not take out the taxes automatically because you aren't an employee (at least not until the graduate phase). Contact your school for details, but in some cases you don't pay taxes on what you spend of your stipend paying for required course materials.
 

CaNEM

Senior Member
10+ Year Member
15+ Year Member
Joined
Jun 12, 2002
Messages
635
Reaction score
4
Really? I was curious because when I got stipends to do summer research programs, no taxes were taken out. Or maybe I was supposed to report it and pay taxes in April? If so don't tell the IRS....
 

tBw

totally deluded
7+ Year Member
15+ Year Member
Joined
Oct 7, 2001
Messages
5,442
Reaction score
17
For summer internships places often don't remove taxes as they can't estimate an annual income and most people owe very little tax on it. You *are* meant to file with the IRS and tell them about that income though...

and yes, PhD stipends are (these days) taxable income. This actually changed a few years ago. Some schools leave it all up to you, some schools are more helpful with this.
 

none

1K Member
10+ Year Member
15+ Year Member
Joined
Jul 28, 2001
Messages
1,903
Reaction score
5
If you get paid for doing something, you should pay taxes on it.
 

Kung Foo

Mad Scientist...
7+ Year Member
15+ Year Member
Joined
Apr 29, 2002
Messages
179
Reaction score
0
So here's the deal. As a grad student, you will recieve a chunk of untaxed money every month. I'm a DDS/PhD at Ohio State, and all I had to do was contact the HR department at OSU, and they hooked me up with forms to estimate how much tax I would owe and forms to pay quarterly installments of that tax. If you pay quarterly, it should be a few hundred dollars every 3 months. You can also elect to just send the government a big chunk of money in April for your whole year's taxes, but I really wouldn't reccommend doing that. I also pay an accountant ~$15 to figure out my taxes for me at the end of the year. She's a family friend of a classmate, but you should be able to find someone pretty easily. The taxes aren't difficult to figure out, but I wouldn't want to mess them up. You can deduct all of your school expenses (books, supplies, etc) since they are "business expenses." Once you're in a program, just ask people ahead of you in the program how they pay taxes, and I'm sure you'll get all the info and contacts you need. This isn't really something to stress about ahead of time.

Good Luck!:)
 

Andrew_Doan

Doc, Author, Entrepreneur
Moderator Emeritus
Lifetime Donor
15+ Year Member
Joined
Oct 1, 2002
Messages
5,633
Reaction score
20
You all can thank Ronald Reagan for taxing of stipends. I think he was the one who signed the bill for this. Before him, stipends were tax free. Some of my colleagues didn't pay the estimated taxes and were audited!

One good thing however, stipends are exempt from social security tax and FICA.
 
Top