Getting a job offer, negotiating your pay and going through the new employee onboarding process is a whirlwind of filling out forms, getting to know new faces and trying to make a great impression. However, don’t let the excitement get in the way of understanding all the perks and benefits the company offers such as tax free tuition money.
What Are Educational Assistance Plans?
Understanding the medical and dental insurance plan options is important. However, one big perk to find out about before negotiating your pay is whether an educational assistance program is in place. Also known as tuition reimbursement, educational assistance means amounts a company will pay or incur for employees’ education expenses. These expenses generally include the cost of books, equipment, fees, supplies, and tuition.
If your employer offers tuition reimbursement you are crazy not to take advantage of it. The perk is worth up to $5,250 per year in tax free earnings for you. You can get reimbursed above and beyond the $5,250 if your company’s program rules allow, but the additional monies will be taxable. A job that pays $22,000 per year but offers tuition reimbursement could be more lucrative long-term than a job that pays over 10% more salary at $25,000 but no tuition reimbursement perk.
Know The Timing Of Payment For Classes
Keep in mind that you often have to lay the tuition and book money out of your own pocket up front and then get reimbursed from your employer after submitting your report card. If you do not have enough money to do this, consider getting a loan from a family member.
As long as you are at least an average student there is no reason your employer won’t reimburse you. Alternatively, some schools offer flexible payment plans and some will allow you to take the classes with no money up front knowing that you are on tuition reimbursement.
Common Company Rules About Tuition Reimbursement
Usually, you initiate a request for tuition reimbursement by informing your immediate supervisor before you register for a class or degree program. Your supervisor then works with Human Resources to get you approved for tuition reimbursement. Once your request is approved, you can go register for classes.
Some common rules that companies will put in place for their tuition reimbursement program include:
- Sometimes you have to be an employee for a minimum of six months before you qualify for tuition reimbursement. It is still worth the wait.
- Some employers require you to earn at least a C grade to earn full reimbursement. Take your class work seriously.
- Some employers have little if any restrictions on the type of courses or degree path you pursue as long as it has a a reasonable relationship to your business.
- Some employers have no requirement that you agree to work for a certain number of years after completing your course work. Some do.
- Tuition Reimbursement Program Is For All Employees
Don’t think that tuition reimbursement is only for managers. The IRS has rules that mandate that companies set-up programs that do not favor highly compensated employees. For example, If you are a nurse you could take business classes toward an MBA.
This will help you stand out from other applicants for leadership positions in the medical field. No matter what you career, if your employer offers tuition reimbursement and you desire to learn new skills and earn more money, take advantage of the tax free tuition money and get to school.
Never Pass Up Tax Free Tuition Money