If I paid for my own tuition in 2022 and it will be getting reimbursed by my employer in 2023, do I have to include the reimbursement amount on my 2022 taxes?

[conn-chris-j]

To clarify, I recently decided to go back to school in 2022 and started my semester in October of 2022, which I paid tuition for in September of 2022, I paid $3775. My school is online and does a semester at a time, so my semester will be ending on 03-31-2023. My work is going to be reimbursing me for this, however, they will not be reimbursing me until April/May of 2023. My employer reimburses up to $8000 a year with $5250 of that being tax free, anything over that amount is taxable income on my W2. 

Since I paid for tuition in 2022 and they will be reimbursing me in 2023, do I include that reimbursed amount under the section for schooling? Or should this amount be included on my 2023 taxes?

[Hal_Al]

Q. Since I paid for tuition in 2022 and they will be reimbursing me in 2023, do I include that reimbursed amount under the section for schooling?

A.  Yes.  Because the tuition paid is (or will be) fully covered by tax free reimbursement (less than $5250), you are not eligible for a Tuition credit on your 2022 tax return.

Since you are being reimbursed, you do not need to complete the education section or enter your 1098-T in TurboTax.   But, if you do enter it, you need to enter the anticipated (tax free) reimbursement.

The 1098-T is only an informational document. The numbers on it are not required to be entered onto your tax return. However receipt of a 1098-T frequently means you are either eligible for a tuition credit or possibly the student has taxable scholarship income. Since you know, you have neither, you do not need to enter anything. 

Q. Or should this amount be included on my 2023 taxes?

A. No. Even though it will be paid in 2023, it is not entered on your 2023 taxes because it is 1. tax free and 2. for 2022 expenses.  It it was taxable reimbursement (over $5250) it would be handled differently. 

[robtm]

You should include any taxable amount you receive in 2023 on your 2023 tax return, not on your 2022 return. 

[conn-chris-j]

@Hal_Al 

Thank you for your clarification regarding this matter. I wanted to ask an additional follow up question. 

Since I will be getting a total reimbursed amount in 2023 of $7550, as I plan on going for another semester which will also be reimbursed in 2023. How will this affect next years taxes? Am I able to claim to the amount that is taxable? Any comments in this matter would be helpful, thank you!

[Hal_Al]

Q. Since I will be getting a total reimbursed amount in 2023 of $7550,  Am I able to claim  the amount that is taxable? 

A. Yes. You will be able to claim $2300 ($7550 - 5250 = 2300) toward the tuition credit.  Because that $2300 is effectively your  taxable income, it is considered paid by you, not your employer, for tax filing purposes. 

$3775. 

[conn-chris-j]

@Hal_Al 

thanks again for your insight!