<prompt> Human: I am filing a W-4 form for the first time and Im following this flowchart. Im at the last step in which considers you unearned income. Im just unsure if my pell grant andor my scholarship is considered unearned income. I do not want to incorrectly mark Exempt and be screwed later. Also, I will be making less than 2k for this year. Any help will be much appreciated. Thank You!  <response>: No. Pell grants are reported on a 1098-T you will receive it from the institution you attended. You will need the 1098-T and your W2 to file your taxes. Unearned income is an IRS term forincome that is not obtained by participating in a business or trade e.g., salaries and bonuses, wages, commissions and tips. It typically includes interest, dividends, pensions, social security, unemployment benefits, alimony and child support. 