Yes. You will need to check both of the boxes since you did receive tax free tuition and did have an amount included in box 1 of your W-2. The amount your employer paid up to the $5,250 would qualify for the tax free portion. The amount over the $5,250 would be taxable income and that is what should be included on your W-2. So for the next screen you should enter the $5,250 for the tax free assistance and then the amount you received from your employer over the $5,250 that was included in the W-2 as the income already reported. It is a good idea to check with your employer to be sure that is how they did handle the tuition payment.
What this means for you and any type of education credit you would otherwise qualify for, is that the amount your employer paid that was above the $5,250 DOES qualify to be counted towards an education credit since you already paid taxes on that amount.
Lifetime Learning Credit
American Opportunity Tax Credit.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
