Our company is planning to offer a scholarship program for dependent children of permanent employees.  The program will use standard recipient selection procedures used by the scholarship administration agency, including the consideration of academic performance, demonstrated and participation in and leadership of school and community activities, work experience, a statement of career and educational goals, unusual personal or family circumstances, and an outside appraisal. Financial need will not be considered.  Recipients attending a four-year institution, college, or university will receive up to a $20,000 award.  Recipients attending a two-year institution, college, or university will receive up to a $10,000 award.   Recipients will be determined solely by the independent, outside scholarship administration agency. 

Are the scholarship awards taxable?

First of all, we are assuming that these are your teachers - meaning your employees as they are employees of schools we have chartered and founded. Thus, that we are really dealing with a W-2 type question here and not a 1099 question (for pay to non-employees). Please note that in the 1099 sense our recommendation is the same as it always is regarding any payments made to non-employees: that is you lump everything together you pay to them, report it all on the 1099, and let them handle the deductions on their own taxes. Ok, now back to educational fringe benefits as they apply to your employees. 

They are not our employees,  they are employees of the charter schools.   We only control the appointment of the board members and where the state appropriations go.  Whether that be to a management company or to the school themselves.  The schools have some financial and academic reporting requirements but they pay their teachers.  We just offer to our charter school teachers the ability of being reimbursed for their tuition.  So what type of payment should that be considered?

We charter several schools and receives an oversight fee from the state to charter these schools.   The charter schools office decided to use some of this oversight income to reimburse charter school teachers for the cost of the classes.  The classes that the charter school office will cover only occur at our university.   My question is whether we have a reportable payment for our university if we make the reimbursement check from our university to the charter school employee?

We have the Family Owned Business Institute that has a program called the Research Scholar.  People prepare a proposal that underwent a blind review process.  The winners of the program are awarded a $5,000 "stipend" that is paid out now for the participant to convert the research into a publishable, refereed article with appropriate references to the Family Owned Business Institute.  In addition, they are expected to disseminate the results of the research to members of the business community, students and other constituencies as appropriate through meetings, seminars, publications and the classroom.  Also, the finished paper needs to be turned in for consideration as a prensentation at the 2012 Family Enterprise Research Conference.

Could we consider this as a fellowship type payment or is it more of a prize and treated as a 1099 reportable payment?

Does the decision change if both employees and non employees were awarded stipends?

We have received a DHHS: Advanced Nursing workforce diversity grant.  The grant can be used to give up to $3,000 to a student as a stipend to enhance their ability for successful entrance into and completion of a professional registered nursing education program.  The students must participate in all activities of the funded program as described in the grant proposal.  It is to provide assistance in covering general living expneses, including allowance for travel.

Would this be taxable?  Would this be reportable?

If a Non-Profit organization is requesting a donation - for Sponsorship (payment would be for advertising in return) -- are the fees reportable

How do we report student loan payments?

Are scholarships and fellowships reportable on Forms 1099?