topic Re: Annual Income Question in Credit Cards

Annual Income Question

Anonymous — Mon, 25 May 2009 01:38:24 GMT

I am getting ready to apply for my first credit card since I won't be allowed to next year thanks to that new legislation (because credit cards are too dangerous for 18-20 year olds but war isn't, amiright?), and I am unsure of something. Can I include my scholarships as part of my annual income? I have a full ride scholarship, leaving me with no debt and disposable income consisting of the extra money for expenses and any personal earnings, and I want to know whether or not I can list the scholarship as part of my income. Leaving it out doesn't really reflect my financial situation (when they ask how much I pay in rent it would look like I'm in debt otherwise), but I don't want to be accused of lying on my first application. Thank you for your assistance!

Re: Annual Income Question

llecs — Mon, 25 May 2009 01:40:46 GMT

You could include it if you declare it on your taxes. Otherwise it isn't income.

Re: Annual Income Question

Anonymous — Mon, 25 May 2009 01:41:19 GMT

apply for a student card(s) -- There are usually no income questions asked...and you pretty much always get approved...

Re: Annual Income Question

Anonymous — Mon, 25 May 2009 01:46:07 GMT

I've heard of people claiming the part of their income that goes into their health savings accounts and other tax-free heath care payments, is this different, or is that just an exception to the rule that income=taxable money?

Edit: It was a student card app, but it still asked the income question.

Message Edited by J0lt_C0la on 05-24-2009 06:46 PM

Re: Annual Income Question

Anonymous — Mon, 25 May 2009 02:00:51 GMT

@llecs wrote:
You could include it if you declare it on your taxes. Otherwise it isn't income.
Income is income regardless if it is taxable or not. OP, you can use whatever you want. Nobody has ever asked me to prove income for any credit preoduct other than a mortgage. If they do,skip them and move on.

Message Edited by hobojon on 05-24-2009 07:00 PM

Re: Annual Income Question

llecs — Mon, 25 May 2009 02:18:08 GMT

hobojon wrote:
@llecs wrote:
You could include it if you declare it on your taxes. Otherwise it isn't income.
....OP, you can use whatever you want. Nobody has ever asked me to prove income for any credit preoduct other than a mortgage. If they do,skip them and move on.
Message Edited by hobojon on 05-24-2009 07:00 PM

Is it not lying when you falsify any information on an application, especially for a bank? Unethical? Illegal?

Re: Annual Income Question

Anonymous — Mon, 25 May 2009 02:34:12 GMT

It's called "scholarship income". As far as I know, ccc's don't care whether your funding is taxable or non-taxable. They want to know whether you have enough money to pay back the credit they give you.

Re: Annual Income Question

Anonymous — Mon, 25 May 2009 03:21:21 GMT

@llecs wrote:
@Anonymous wrote:
@llecs wrote:
You could include it if you declare it on your taxes. Otherwise it isn't income.
....OP, you can use whatever you want. Nobody has ever asked me to prove income for any credit preoduct other than a mortgage. If they do,skip them and move on.
Message Edited by hobojon on 05-24-2009 07:00 PM

Is it not lying when you falsify any information on an application, especially for a bank? Unethical? Illegal?

Who said anybody is lying? The fact is that income doesn't have to be taxable to be considered income. What is being falsified? Unethical, illegal? Not sure what you are referring to.

Re: Annual Income Question

Logical — Mon, 25 May 2009 03:59:45 GMT

Certain types of interest are not taxable by feds or state, but it is income.

For a lot of folks social security is not taxable, but it is income.

Re: Annual Income Question

UpNUp — Mon, 25 May 2009 04:11:52 GMT

Logical:

Point well made.

My pension is taxable. My interest income is taxable. My Social Security is not.

Income is income. Regardless.

Re: Annual Income Question

Anonymous — Mon, 25 May 2009 06:28:56 GMT

Apply from your parents address, have them send you the card and pay/monitor it online

Re: Annual Income Question

llecs — Mon, 25 May 2009 16:35:17 GMT

Ulan wrote:
It's called "scholarship income". As far as I know, ccc's don't care whether your funding is taxable or non-taxable. They want to know whether you have enough money to pay back the credit they give you.

Scholarship $$$ isn't income, I wouldn't believe. If OP got a full ride to school, let's say $20k/yr via a scholarship to be directed towards tuition, board, books, etc., OP didn't earn $20k. OP cannot take that $$$ and blow it on weekend fun, movies, a new car, etc., right? OP certainly cannot use it to pay off CC debt.

I've been many years removed from school and I do remember getting a $5k scholarship for my first year only. I don't recall ever having to declare that as income (I never saw the $$$, only a reduced tuition bill). Is scholarship money considered income?

Message Edited by llecs on 05-25-2009 12:35 PM

Re: Annual Income Question

Anonymous — Mon, 25 May 2009 16:53:22 GMT

@llecs wrote:
@Anonymous wrote:
It's called "scholarship income". As far as I know, ccc's don't care whether your funding is taxable or non-taxable. They want to know whether you have enough money to pay back the credit they give you.
Scholarship $$$ isn't income, I wouldn't believe. If OP got a full ride to school, let's say $20k/yr via a scholarship to be directed towards tuition, board, books, etc., OP didn't earn $20k. OP cannot take that $$$ and blow it on weekend fun, movies, a new car, etc., right? OP certainly cannot use it to pay off CC debt.

I've been many years removed from school and I do remember getting a $5k scholarship for my first year only. I don't recall ever having to declare that as income (I never saw the $$$, only a reduced tuition bill). Is scholarship money considered income?

Whether scholarship money is taxable or not depends on the scholarship. Some of them are treated as scholarship income (or compensation), others as wages (I got one that was treated as wages by the IRS). But I guess the OP's scholarship will, as you assume, not be taxable.

If your scholarship covers living expenses, you can of course pay your credit card bills with it. You have to wear clothes, after all. Or food, if you are not covered by a meal plan.

The main point I wanted to make is that the credit card company is not the IRS. They don't care whether your monthly income is taxable or not. They want to know whether you have a regular monthly stream of money coming to your wallet that you can use for paying your credit card bills. If your scholarship allows for that, you are fine.

Re: Annual Income Question

Logical — Mon, 25 May 2009 16:54:31 GMT

@llecs wrote:

This was your 11,000 post!! that is 16 2/3 posts a day (with no days off).

(hmmm, no, I won't ask)

Re: Annual Income Question

Anonymous — Mon, 25 May 2009 17:36:56 GMT

@llecs wrote:
@Anonymous wrote:
It's called "scholarship income". As far as I know, ccc's don't care whether your funding is taxable or non-taxable. They want to know whether you have enough money to pay back the credit they give you.

Scholarship $$$ isn't income, I wouldn't believe. If OP got a full ride to school, let's say $20k/yr via a scholarship to be directed towards tuition, board, books, etc., OP didn't earn $20k. OP cannot take that $$$ and blow it on weekend fun, movies, a new car, etc., right? OP certainly cannot use it to pay off CC debt.

I've been many years removed from school and I do remember getting a $5k scholarship for my first year only. I don't recall ever having to declare that as income (I never saw the $$$, only a reduced tuition bill). Is scholarship money considered income?
Message Edited by llecs on 05-25-2009 12:35 PM

The only part the university takes directly is the tuition. The rest for room and board, books, expenses, etc. gets deposited directly into my checking/savings account, and I manage it as I see fit. (Example: there's no way I'm going to buy the books directly from the bookstore when I can get the same books online for half the price, and it's not like they're going to directly pay for my off-campus housing.) So should I leave out the tuition and declare the expenses money, or are they going to see a small number and assume I must be incurring student loans?

Also, any suggestion that involves letting my parents so much as touch my credit with a 10 foot pole is a bad one for my case, sadly it could only hurt to let them near it.

Re: Annual Income Question

Logical — Mon, 25 May 2009 17:39:52 GMT

It should be pointed out even according to the IRS the only question about scholarship money is if it is excludable from taxable income. See Pub 17: "A candidate for a degree can exclude amounts received as a qualified scholarship or fellowship." Gross income (taxable income) is "...all income you receive in the form of money, goods, property, and services that is not exempt from tax." If you find a penny on the sidewalk it is taxable.

Re: Annual Income Question

Anonymous — Mon, 25 May 2009 17:49:18 GMT

I think found the IRS rule to which you are referring, do you mean this? Taxable Income

@IRS wrote:
If you are a candidate for a degree, you generally can exclude from income that part of the grant used for:

Tuition and fees required for enrollment or attendance, or
Fees, books, supplies, and equipment required for your courses.

You cannot exclude from income any part of the grant used for other purposes, such as room and board.

I understand now what is and isn't taxable income for my scholarship, but as previously mentioned, health care and SS aren't taxable either. Hopefully I can find a customer service number to call and ask what the company wants to see listed.

Message Edited by J0lt_C0la on 05-25-2009 10:49 AM

Re: Annual Income Question

Anonymous — Mon, 25 May 2009 18:27:31 GMT

@Anonymous wrote:
I understand now what is and isn't taxable income for my scholarship, but as previously mentioned, health care and SS aren't taxable either. Hopefully I can find a customer service number to call and ask what the company wants to see listed.

That probably doesn't hurt. But keep in mind that you are not dealing with the IRS here.

The definition of terms like that always depends on whom you ask. Heck, not even the term "US resident" is unequivocally defined. Depending on whether you ask the IRS or USCIS, you will get two different answers. Well, at least I get two different answers about my status .

Re: Annual Income Question

Anonymous — Mon, 25 May 2009 20:55:13 GMT

Called Chase through one of those backdoor numbers listed in the backdoor numbers thread (thanks for the info), and the person I spoke to said I can list the entire scholarship. Thanks for all your help!