Taxable scholarships?

[Mike or Penny Novack]

>
> The "final manual adjustment" is what I was thinking about.  The thing 
> I was (slightly) concerned about is that if I performed the "final 
> adjustment" and only *then* discovered that there is an error in my 
> textbooks account, I would need to remember to correct the "final 
> adjustment" after correcting the original error.

This is actually a "trade off" situation. One of the problems of double 
entry bookkeeping is that generally you can get automatic information in 
one way only at the cost of not having as easy access to information 
another way.

I was describing the way MOST people would choose, that they would 
choose to have expenses grouped with expenses to make these easy to see. 
But at the price of not having this you could get the automatic behavior 
you wanted (but now you would need to do a computation to see all 
expenses).

You would have a "taxable scholarship income" account as parent. Under 
this you would have child accounts for "gross scholarship income", 
"tuition", and "deductible books" (*). In the first amounts would be 
normally on the credit side and in the latter two on the debit side. Now 
"taxable scholarship income" adjusts automatically but you won't see 
tuition and deductible books in your expense totals (now THAT becomes a 
manual operation).

Michael


* BTW -- I'd check with your tax advisor about what counts as a 
deductible textbook. I suspect "REQUIRED for a course you are taking for 
credit" might be too strict. I suspect might depend on the nature of the 
book as in you might be able to count novels bought for a lit course 
only if required but any book like "Solid State Physics" be allowed even 
if you weren't taking a Physics course for credit. But I'm not up on 
current tax law for students as my personal experience with that four 
decades ago.