Just in general the IRS doesn't tax scholarships. However they consider "employee benefits" as something different and will now be taxing this school assistance if it exceeds 5250.00 per year. Which is well below the amount that you need to attend a university. This will significantly hinder students ability to attend college. In addition to this to make sure they get their money they will calculate the amount that you received for the year and ten take that amount and divide it by 100. They will then take that result number and take 100 dollar out of your pay check for that many weeks. I am currently an employee and I make just over 100 a week. It is hard enough to make it in the city with this extremely low pay check but if they go through with this then I will basically lose all of my income for the rest of the year starting at mid October. I believe that scholarships and Employer benefits should be consider the same and both be exempt from taxation. Especially considering that as a country we should be do everything we can to encourage young minds to educate themselves.