Education Assistance Imputed Income

[rumman18]

Hi All,

My Employer has this policy for educational assistance program where if I take more than 5225.00$ as stipend a year then the amount exceeding 5225.00$ will get counted as imputed income and I will have to pay taxes on that exceeding amount.

For the year 2019, I have received 9975.00 (from my 1098-T from my school) and I have paid taxes on the amount that exceeded 5525.00$

I just wanted to know how to go about claiming the tax credit for this? I don't see explicitly on my W2 the tuition assistance amount. 

Thanks for the help

[KrisD15]

An employer may give an employee up to 5,250 per year in education assistance. 

Up to that amount is not taxable to the employee/student. 

Normally that amount is listed on the W-2 and any amount over is included in Box 1 of the W-2. 

You would need to find out from payroll if the amount over the 5,250 is included in Box 1 of your W-2. 

And also, if the amount over 5,250 is included in Box 5 of the 1098-T? 

Is the 9,975 on the 1098-T in box 1 or 5? 

[rumman18]

Hi Kris, thanks for the clarification. I am not sure if the amount over is included in box 1 or not. I emailed them to ask, but i believe it is included. 

And for 1098-T box 1 has 9975.00 and box 5 has 1095.00 

I checked my pay stub and it said that education imputed income was 3440.00. I am still not sure which amount i to put for tax break.  

[Hal_Al]

You need to get a netter handle on your numbers. What is the $1095 from? A separate scholarship or is part of your employer assistance? Does some of this straddle two calendar years (reimbursement came in a different year than tuition paid )?  Did your employer pay ALL tuition and expenses to the school or did you pay and get reimbursed by your employer.  It's not likely that the box 1 amount is exactly what your employer reimbursed  (9975-5250= 4725, not 3440). 

Based on what you've provided so far, you should claim $4725 for the tuition credit.  The simple work around is enter $9975 in box 1 at the 1098-T screen, and 5250 in box 5.