Fellowships, scholarships and awards

Fellowships, scholarships, or awards paid to individual students are generally not reportable under Internal Revenue Service guidelines but are likely taxable. If the payee is a nonresident alien for tax purposes, the payment will be subject to withholding taxes and reported to the individual and the Internal Revenue Service on annual Form 1042-S.  The Disbursement Request to Student Form includes guidance for determining how payments to students should be treated.

Fellowship, scholarship and award payment requests should be submitted on the Disbursement Request to Student form. The recipients are not employees performing services and therefore cannot satisfy the “business purpose” requirement under an “accountable plan” as defined by the Internal Revenue Service. Departments are responsible for providing a current copy of the Fellowship / Scholarship / Award letter to inform the recipient student of the potential tax implications of the payment. This award letter is to be attached as a receipt to the Disbursement Request to Student Form, available here: