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June 1, 2019
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If my employer reimburses me for higher education, but I have to pay back in employment do I consider that as employee provided assistance

  • June 1, 2019
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I assume that you are saying your employer requires that you continue in his employment for a specified period of time, or your educational benefits would have to be repaid. If my understanding of that is correct, that is not an unusual provision; it is still employer provided educational assistance.

Amounts received by an employee under a written educational assistance plan are excluded from taxable income, up to $5,250 per year. 

The amount received should not be included in Box 1 of Form W-2. Since the benefit is not taxed, you have no reporting obligation on your tax return. But, you cannot claim any educational credits or deductions based on the tuition and fees paid (or reimbursed) by the employer.

For more information, please see IRS Pub. 970 Tax Benefits for Education.

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Answer
June 1, 2019

I assume that you are saying your employer requires that you continue in his employment for a specified period of time, or your educational benefits would have to be repaid. If my understanding of that is correct, that is not an unusual provision; it is still employer provided educational assistance.

Amounts received by an employee under a written educational assistance plan are excluded from taxable income, up to $5,250 per year. 

The amount received should not be included in Box 1 of Form W-2. Since the benefit is not taxed, you have no reporting obligation on your tax return. But, you cannot claim any educational credits or deductions based on the tuition and fees paid (or reimbursed) by the employer.

For more information, please see IRS Pub. 970 Tax Benefits for Education.