Pennsylvania BFR Rules Graduate Stipends Exempt From Income Tax, Affects Tax Credit Eligibility

The Pennsylvania Board of Finance and Revenue (BFR) issued a ruling regarding the taxpayer’s petition for review of her 2023 personal income tax assessment. The taxpayer, a graduate student earning her doctorate from the University of Pittsburgh, contested the Pennsylvania Department of Revenue’s increase in her reported net compensation and disallowance of her tax forgiveness credit. The Board found that the taxpayer’s stipend from the University, which was required for her degree program, was not subject to Pennsylvania personal income tax under the applicable regulations. However, the Board determined that the taxpayer’s stipend should be included in her eligibility income ...