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What causes you to owe the IRS money?

Just curious. Will my financial aid cause me to owe money? I've had financial aid and grants in the past and it hasn't caused this. I'm curious.

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LaurenKaye29

Asked by LaurenKaye29 at 9:58 PM on Feb. 2, 2009 in Money & Work

Level 8 (261 Credits)
Answers (5)
  • No, your financial aid and grants for school are non taxable.
    Magpie75

    Answer by Magpie75 at 11:53 PM on Feb. 2, 2009

  • Lot of things can cause you to owe money, but probably not your financial aid and certainly not your grants! People who are self employed and people who do not withhold the proper amount are examples of people who will pay in.. but there are many more.
    pupmom

    Answer by pupmom at 12:12 AM on Feb. 3, 2009

  • pupmom is right Financial aid and grants are not taxable (work study is but the schools usually make you claim 0 for dependants so the Irs owes you) People who I know that have owed the Irs money are the self employed, people who claim more dependants than they really have, people who have lots of intrest bearing accounts or houses that they rent out. Most other people get a refund.
    babyfat5

    Answer by babyfat5 at 7:51 AM on Feb. 3, 2009

  • Are you asking what causes someone to owe back taxes? Owing the IRS for back taxes can mean that someone has back child support, previous years taxes they have not paid, and unpaid student loans.


    If you are asking what causes a person to owe current year? That means that a person did not have enough withheld in their paychecks during the year. Sometimes people forget to have fed. income taxes withheld when they draw unemployment. Some have self employment, and if they do not make estimated payments during the year, they WILL owe.


    Now if a person makes less than than their standard deduction + their personal exemption, then they do not owe, nor would they need to have anything withheld,b/c they would not have a tax liability anyway. You are welcome to learn more here in cafemom at: http://www.cafemom.com/group/filingtaxes2009

    lifeasinoit

    Answer by lifeasinoit at 8:17 AM on Feb. 3, 2009

  • No, financial aid is not income. It's really simple. income x tax rate = tax due. If you haven't paid in enough tax, you owe the difference.
    Anonymous

    Answer by Anonymous at 8:32 AM on Feb. 3, 2009

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