College tuition reimbursement

[c w]

scenario: A person pays tuition bills directly to the school and is
reimbursed by the company thru their W-2 payroll. They notice it's
not fair because the W-2 reimbursement is taxed and doesn't fully
compensate for the tuition payments to the school. Can they claim
this difference as an unreimbursed employee expense on Sch. A on the
1040?

 

[ira smilovitz]

scenario: A person pays tuition bills directly to the school and is
reimbursed by the company thru their W-2 payroll. They notice it's
not fair because the W-2 reimbursement is taxed and doesn't fully
compensate for the tuition payments to the school. Can they claim
this difference as an unreimbursed employee expense on Sch. A on the
1040?

If the reimbursement is via payroll, I would claim the entire education expense, subject to the various rules covering education deductions and credits.

Ira Smilovitz
Leonia, NJ

 

[JoeTaxpayer]

If the reimbursement is via payroll, I would claim the entire education expense, subject to the various rules covering education deductions and credits.

Ira Smilovitz
Leonia, NJ

I recommend reading Pub 970. Ch 11 specifically state that amounts up to
$5250 should not appear on your W2. The employer may be mishandling this.

 

[Alan]

scenario: A person pays tuition bills directly to the school and is
reimbursed by the company thru their W-2 payroll. They notice it's
not fair because the W-2 reimbursement is taxed and doesn't fully
compensate for the tuition payments to the school. Can they claim
this difference as an unreimbursed employee expense on Sch. A on the
1040?

No, it is not an unreimbursed employee business expense. Assuming that
the employer does not have a formal written education assistance program
for employees, the amount reflected in Box 1 of the W-2 is correct. The
tuition paid can be treated as a qualifying higher education expense (I
assumed we were dealing with a college or university.) for purposes of
either a deduction or credit. See IRS Pub 970 for more details.