What tax issues should I prepare for?

WantWhatsBest
Sat, 31 Mar 2018 13:36:26 +0000

Here’s what I found about the taxability of tuition remission/waiver. I took this from NYU’s site. Seems like they ought to know.

In general, you do not have to pay income tax on Tuition Remission benefits for undergraduate degree programs for yourself, your spouse and your dependent children (age 23 or younger as of the end of the calendar year).

Because the IRS does not recognize the tax exemption of benefits extended to domestic partners, all Tuition Remission for registered domestic partners and their dependent children is considered taxable.

Under IRS regulations, up to $5,250 per year of graduate Tuition Remission benefits for employees are non-taxable. This means the first $5,250 of your graduate tuition costs will not be taxed. Anything over $5,250 will be considered taxable income, and the tax on the value of the benefit will be withheld from your paycheck. If the graduate level course work is job-related, it will be excluded from taxable income.

Under IRS regulations, any graduate-level Tuition Remission benefits for a spouse/ registered domestic partner, or dependent children are fully taxable.

So, it looks like the tuition waiver for undergrad is not taxed. For grad, the first $5250 is tax-free and the rest is reported as income and taxed, I assume.