Overview
Instructions
Please submit this form together with your Application for Tuition Exemption at the beginning of the semester to the appropriate office (depending on where you are registering for classes). REMEMBER THAT BOTH YOU AND YOUR SUPERVISOR NEED TO SIGN. Please detach these instructions before handing in the form.
If this form is not on file, your tuition benefits for graduate classes will be taxed.
Eligibility
IF YOU ARE ENROLLED IN AN UNDERGRADUATE DEGREE PROGRAM, YOU DO NOT NEED TO COMPLETE THIS FORM. GRADUATE-LEVEL COURSES TAKEN AS PART OF UNDERGRADUATE PROGRAMS ARE NOT TAXABLE.
Complete the form entitled Job-Related Graduate Course Certification Application Form, (1) if you receive tuition exemption for graduate courses (4000 and above) or a graduate degree program, and (2) if you believe the classes you take meet the IRS definition of job related (see "IRS Tax Regulations" below).
Note that the University will deduct taxes for ALL of your courses in a given term unless ALL of them are job related. (You may later file with the IRS for reimbursement for any course that is job related.)
IRS Tax Regulations
Under current IRS rules, tuition exemption benefits for graduate courses are taxable unless courses are job related. A course is job related (and the benefit is tax exempt) if it meets the criteria in Treasury Regulation Section 1.162.5, namely:
a) The course maintains or improves skills required in your current position; OR (b) The course meets express requirement of applicable law, to retain (but not obtain) your current position;
AND
(c) The course does not enable you to meet the minimum educational requirements for your current job;
AND
(d) The course does not qualify you for a new trade or business
In other words, a course is considered job related if EITHER (a) or (b) is true, AND if BOTH (c) and (d) are true.
Currently, all doctoral programs are taxable. The IRS considers these programs or degrees upward bound education that may qualify you for a new trade or business as defined by IRS criteria. Master's degrees may or may not be taxable, depending on whether the courses may qualify you for a new trade or business.
Keep in mind that tax laws are complicated and change often. Your best source of information about tax laws and how they affect you is a professional tax advisor.