CPA Tax Advice for Financial Literacy Month
Accounting Today
April is Financial Literacy Month and Fred Slater, CPA, and Ellen Minkow, CPA, of MS 1040 LLC in New York City are offering some special tax advice. “It is important to have a year-round budget, and keep finances in check,” said Slater. “An important part of this is year-round tax planning. This can help you prepare for life changes while staying on track to achieve financial goals.” “For many people, this is planning for college,” Minkow added. “It is important to know if scholarships and grants are subject to federal income tax. If you are a candidate for a degree at an educational institution and receive a qualified scholarship or fellowship that you use for tuition, fees, and required expenses (e.g., books, supplies, and equipment), you need not include the scholarship amount in your taxable income. If, however, your scholarship includes money for room, board, and other incidentals, those dollars are taxable. If you are not a candidate for a degree, your entire scholarship is taxable.”