IRS Issues Guidance on 1098-T Reporting for HEERF Emergency Grants to Students
12/15/2020
On December 14, the IRS issued much-anticipated guidance on the reporting of Higher Education Emergency Relief Fund (HEERF) emergency grants to students on Form 1098-T.
In an FAQ on its website, the IRS clarified it “will not require that these grants be reported pursuant to section 6050S of the Internal Revenue Code on Form 1098-T.” (See Question 3.) The FAQ also indicated that Federal Supplemental Educational Opportunity Grants (FSEOG) used for emergency aid to students do not need to be reported. The IRS noted that reporting of these emergency grants on the Form 1098-T could have resulted in the issuance of underreporter notices.
In November 2020, NACUBO had asked the IRS for guidance on the treatment of HEERF emergency grants to students for 1098-T reporting purposes.
Bursars and student accounts offices should begin working with their institutions’ information technology offices as well as their student information system (SIS)/enterprise resource planning (ERP) provider to ensure the emergency grants to students are not reported on the 2020 Form 1098-T.
