Q. My question is: Can I deduct the amount above $5250 to claim the LLC?
A. Yes, since the tuition was essentially paid with your after tax money.
Q. My employer makes me pay them at a rate of 32.65% back to them in a lump sum for the amount over $5250.
That doesn't make any sense. One payment of 32.65% or several payments until it's all paid back? You sure it's not just 7.65% (the FICA tax your employer paid of the benefit). Or did they also include a "tax allowance" in box 1 of the W-2 that they are asking you to pay back, 25% being the IRS mandated withholding on lump sums (25 + 7.65 = 32.65). You should ask for an explanation.
