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If you receive educational assistance benefits from your employer under an educational assistance program, you can exclude up to $5,250 of those benefits each year. This means your employer should not include the benefits with your wages, tips, and other compensation shown in box 1 of your Form W-2. This also means that you do not have to include the benefits on your income tax return.
You cannot use any of the tax-free education expenses paid for by your employer as the basis for any other deduction or credit, including the Hope credit and the lifetime learning credit.-
Meals, lodging, or transportation.
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Tools or supplies (other than textbooks) that you can keep after completing the course of instruction.
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Courses involving sports, games, or hobbies unless they:
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Have a reasonable relationship to the business of your employer, or
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Are required as part of a degree program.
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