How are DREU stipends treated for US income tax purposes?
Because these awards are not for qualified tuition and related expenses but instead represent compensation for research services rendered as a condition of receiving the grant, they are reportable as gross income, but not as wages. The CRA is not required to withhold any taxes on these stipends and no such withholding shall be done. The CRA is required to issue 1099’s or W-2’s to award recipients; these are mailed to participants in the spring, typically February.
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