As the federal tax return deadline approaches, I am starting to plan for taxes. However, I don't understand why the room and board expenses in a scholarship are taxable. I am an independent student who doesn't have any income and receives a need-based aid from my institution.

IRS states that anything that's not tuition or a required expense is taxable. After taking out the standard deduction, I think I still calculated about $1000 in tax.

If I am receiving help to pay for something that I can't afford, why do I have to pay for it?
Also, is there any way to minimize the tax I will have to pay?

This is my first time filing taxes. Thank you.

2 Answers 2


In addition to what littleadv wrote (it's this way because that's how the law was written), I'd argue that this statement that you made is false:

I am an independent student who doesn't have any income and receives a need-based aid from my institution.

You apparently do have income, namely your scholarship / need-based aid. The default rule is that all income is taxable, so the exception is that the part going toward tuition is not taxable, not, as you seem to believe, that the room & board part is taxable.


The answer is: because that's what the Congress has decided to enact, and the President (Reagan, I believe in this case, but it doesn't really matter) decided to sign into the law.

If we want to speculate, then the rationale may be that since you're not required to pay room and board (and can, instead, sleep in the park or stay at your parents'), it is an optional expense and as such doesn't deserve the beneficial treatment. You can call your Congressman and voice your disagreement, if you disagree.

  • 2
    How does this translate if my instituion requires me to live on campus, and that rule is part of attending the institution. Sure, living on campus and paying them room and board may not be mandatory for all schools. I could find roommates and get an apartment and pay much less, but that is not my situation.
    – Skipher
    Commented Mar 9, 2016 at 17:56
  • 1
    As @skipher said, the tules are what they are. If you want to have them, convince your Congresscritter to submit s bill to change them and convince the rest of the Congress and the president to let the changes become law. If you have an exceedingly good argument, the change might happen before your own kids go off to college.
    – keshlam
    Commented Mar 9, 2016 at 21:21

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