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Tuition Reimbursement |
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An employer can exclude up to $5,250 of educational assistance provided to an employee under an educational assistance program from the employee's wages each year. There is an expiration date. If you do not have an educational assistance plan, or you provide an employee with assistance exceeding $5,250, you can exclude the value of these benefits from wages if they are working condition benefits.
Education assistance means amounts that the employer pays or incurs for its employees' education expenses. These expenses generally include the cost of books, equipment, fees, supplies, and tuition. However, these expenses do not include the cost of a course or other education involving sports, games, or hobbies, unless the education:
• Has a reasonable relationship to your business, or
• Is required as part of a degree program.
Education expenses do not include the cost of tools or supplies (other than textbooks) that your employee is allowed to keep at the end of the course. Nor do they include the cost of lodging, meals, or transportation.
For more information, see Publication 15-B, Employer's Tax Guide to Fringe Benefits and Publication 508, Tax Benefits for Work-Related Education at http://www.irs.gov/pub/irs-pdf/p15b.pdf. |
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