Tax Tip 2024-68: Employer-offered educational assistance programs can help pay for college

IRS Tax Tips August 7, 2024
Useful Links: IRS.gov Help For Hurricane Victims News Essentials What's Hot News Releases IRS - The Basics IRS Guidance Media Contacts Facts & Figures Around The Nation e-News Subscriptions The Newsroom Topics Multimedia Center Noticias en Español Radio PSAs Tax Scams/Consumer Alerts The Tax Gap Fact Sheets IRS Tax Tips Armed Forces Latest News IRS Resources Contact Your Local IRS Office Filing Your Taxes Forms & Instructions Frequently Asked Questions Taxpayer Advocate Service Where to File IRS Social Media	Issue Number: Tax Tip 2024-68 Employer-offered educational assistance programs can help pay for college An educational assistance program is an employer's written plan to provide employees with undergraduate or graduate-level educational assistance. These programs allow employers to pay student loan debt and other education expenses tax-free. Eligible expenses Educational assistance programs can help pay for: Books Equipment Supplies Tuition and other fees Qualified education loans Loan payments These programs can be used to pay principal and interest on an employee's qualified education loans. The option is available only for payments made after March 27, 2020. Under current law, this option will be available until Dec. 31, 2025. Payments made directly to the lender and those made to the employee qualify under these programs. By law, tax-free benefits under an educational assistance program are limited to $5,250 per employee per year. Normally, assistance provided above that level is taxable as wages. For other requirements, see Publication 15-B, Employer's Tax Guide to Fringe Benefits. Chapter 10 in Publication 970, Tax Benefits for Education, provides details on what qualifies as a student loan. More information Frequently asked questions about educational assistance programs Back to top           Thank you for subscribing to IRS Tax Tips, an IRS e-mail service. For more information on federal taxes please visit IRS.gov. This message was distributed automatically from the IRS Tax Tips mailing list. Please Do Not Reply To This Message.

 

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