How Do I Report Income from Employee Educational Assistance on a W2 Form?

Report certain income from employee educational assistance as wages on an employee’s Form W2. There are specific exceptions and guidelines for how you report these benefits. Assistance benefits that exceed $5,250 belong in box 1 of Form W2. Do not include the payments in box 1 that meet the threshold but the Internal Revenue Service regards as fringe benefits. Another big exception to keep in mind is how to report income from employee educational assistance that is less than $5,250. Employees may exclude up to that amount if the benefits qualify as part of a written educational assistance program. Speak with your employees and tell them whether their benefits fall within that category.

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