Chapter 7: Scholarships & Fellowships
7.1 INTRODUCTION
(a) Background to Section 117
(b) Changes Made by Tax Reform Act of 1986
7.2 THE SECTION 117 RULES
(a) The “Qualified Scholarship” Requirements
(b) The “Candidate for a Degree” Requirement
(c) The “Educational Organization” Requirement
(d) Interaction with Education Tax Credits
7.3 WITHHOLDING AND REPORTING ON SCHOLARSHIP/FELLOWSHIP PAYMENTS
(a) Rules Applicable to Students Who Are U.S. Citizens and Residents
(b) Rules Applicable to Nonresident Alien Students
7.4 QUALIFIED TUITION REDUCTIONS
(a) General Rule
(b) Nondiscrimination Rules
7.5 SECTION 117(C)—DISTINGUISHING BETWEEN SCHOLARSHIP/FELLOWSHIP GRANTS AND COMPENSATION
(a) Grants for Independent Study
(b) National Research Service Award (NRSA) Grants
(c) Amount of Grant Treated as Compensation
(d) Tuition Remission Reimbursements under Federal Grants
(e) Forgiveness of Penalties
(f) Scholarship/Fellowship Grants with Work and Payback Requirement
