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Section 117(a) exempts from gross income "any amount
received as a qualified scholarship by an individual who is a
candidate for a degree at an educational organization described
in section 170(b)(1)(A)(ii)." A "qualified scholarship" means
"any amount received by an individual as a scholarship or
fellowship grant to the extent * * * that * * * such amount was
used for qualified tuition and related expenses." Sec.
117(b)(1). Qualified tuition and related expenses are limited to
"tuition and fees required for the enrollment" and "fees, books,
supplies, and equipment required for courses of instruction".
Sec. 117(b)(2). For purposes here, we primarily are concerned
with two requirements of section 117--viz, whether petitioner
qualifies as a candidate for a degree and whether amounts
received were used for "qualified tuition and related expenses".
A. Candidate for a Degree
The parties stipulated that petitioner was not a candidate
for a degree in 1993. Ordinarily this would end the matter.
Petitioner argues, however, that the requirements necessary for
board certification in hematology and medical oncology should be
viewed as the equivalent of a candidacy for a degree for purposes
of section 117. Petitioner relies on an example given by the
proposed regulations:
Example (2). B is a scholarship student during academic
year 1987-1988 at Technical School V located in State W. B
is enrolled in a program to train individuals to become data
processors. V is authorized by State W to provide this
program and is accredited by an appropriate accreditation
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Last modified: May 25, 2011