Are taxes taken directly from the Education Award or am I responsible for making the payment at tax time?
The tax is not automatically deducted from the Education Award. You are responsible for covering this cost. Education Award funds can only be used for cost of attendance at a Title IV school or repayment of prior loans. You must use other income sources to pay any tax burden. How will the award affect reporting on income tax return? You will get a 1099 at the end of the year for any amount of your award that you use.