In an effort to continue providing access to an LSU education, we are utilizing allocations from the Higher Education Emergency Relief Fund (HEERF) to directly support thousands of students. This week, LSU began notifying eligible students regarding their grant amounts. This round of funding will be distributed to degree seeking students enrolled in the Fall 2021 semester. Block grant amounts were determined based on financial need as determined by the FAFSA. An application or FAFSA were not required for eligibility. An initial text message was sent to obtain consent to apply funding to the billing statement. Follow up emails are being sent with a secure link for students to choose the option to apply funding to the billing statement.
IRS updates FAQs for Higher Education Emergency Grants
In IR-2021-70, Emergency aid granted to students due to COVID is not taxable, the IRS issued FAQs on how students and higher education institutions should report pandemic-related emergency financial aid grants. These FAQs were subsequently updated on May 18, 2021.
These updated FAQs are being issued to provide general information to taxpayers and tax professionals as expeditiously as possible.
More information about reliance is available.
I am a student at a higher education institution and my institution is using federal funds under the CARES Act, the CRRSAA, or the ARP to cancel or discharge my overdue balances, such as for tuition and fees. Is the amount of the discharge included in my gross income? (added February 15, 2022)
No. If your institution is using federal funds to cancel or discharge your overdue balance for tuition and fees, your debt is being paid by the Federal government and such payment generally would be included in your gross income. However, because your debt is being paid by the Federal government in response to the COVID-19 pandemic, the amounts paid by the Federal government, including grants used to pay an overdue balance for tuition and fees owed to the institution, are not included in your gross income.
Do higher education institutions have any requirements under Internal Revenue Code section 6041 to report information on Form 1099-MISC if the institutions use federal funds under the CARES Act, the CRRSAA, or the ARP to pay the students’ overdue balances for tuition and fees? (added February 15, 2022)
No. Higher education institutions do not have information reporting requirements under section 6041 when using these federal funds to pay students’ overdue balances for tuition and fees. These payments are not included in students’ gross income. Because the payments are not income, section 6041 does not apply to them, and higher education institutions are not required to file or furnish Forms 1099-MISC, “Miscellaneous Income,” reporting the payments.
For additional questions, please contact covidrelief@lsu.edu.