Hello everyone,

I was just curious if anyone had an answer to my question. I am a sophomore now in community college and I received a substantial amount of financial aid which was all refunded to me directly since my classes are covered by a promise grant here in California. I was confused by many saying you do have to pay taxes. From what I’ve read on the IRS website, you do if it’s not a qualified expense. For example, we’re college students and we need to survive and eat, but qualified only seems to go towards required tuition and fees according to the IRS. Does anyone report their refunds on their returns? I received all this money in 2024 because my disbursement was delayed. I’m expecting around the same amount this fall, putting me well over 25k of financial aid returns. I know the income limit for taxes is around ~12k. If anyone has any advice, it would be greatly appreciated. I ask this because I want to put my refunds into a HYSA so that more money is available once I transfer to university, but I would be making almost a grand from interest, which is also taxable. I’m just scared of the IRS and don’t want to make a mistake. I also don’t want to over share information with them that’s not necessary. They’ll just take whatever they’d like.