Hi, I am being taxed for education assistance received from my employer. How can I calculate how much imputed income will come out my paychecks?

Forum|Forum|5 years ago
April 15, 2021
1 reply
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I have requested more than $5,525, anything over that amount I will be taxed (which is what is happening now). However I have now paid more than half of what I requested in paycheck deductions. I am confused on if I am being taxed or just paying for the semester via my wages.

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Hal_Al

Employee

You are just paying for the semester (the part over $5250) via your wages.

There is no "imputed" income. The amount over $5250 may have been sent directly to the school (instead of included in your pay check), but you effectively "received" it and that amount was included in the box 1 amount on your W-2.

stephaniebsmith2Author

Thanks for your response! My employer offers up to $7,000 in education assistance. I requested about $6500 for this semester. $2000 has been deducted from my last two checks under "tuition imputed". $4000 in total. I'm not sure that is what's happening here. I understand anything over $5250 will be taxed but why is so much being deducted? @Hal_Al