• FREE RESOURCES
        • Accounts Payable
          Finally! The trick to securing greater T&E compliance
          Benefits
          Rooting out folks who don’t belong on your health plan: A 6-point dependent audit checklist
          IT
          3 costly misconceptions about biz email compromise
          Credit and Collections
          Collecting via email: 4 must-make moves in your subject line
          Accounts Payable
          5 Tough-to-spot signs that an invoice is fake
  • PREMIUM CONTENT
        • Staff management
          120 Proven Communications Tips for Today’s CFO
        • Payroll
          Handling Nonexempt Employee Pay: Stay Compliant and Avoid DOL Audits
          Accounts Payable
          T&E Best Practices: Complete Guide to Ensure Compliance
          Payroll
          Payroll Best Practices: 4 Ways to Save Time and Money
        • Staff management
          Email Best Practices: A 6-Question Quiz
          Staff management
          Innovative Communications Strategies: An Email Case Study
          Staff management
          A 5-part Framework for Successful Workplace Communications
        • SEE MORE
          PREMIUM RESOURCES
  • CORONAVIRUS RESOURCES
  • LOGIN
  • SIGN UP FREE

CFO Daily News

  • FREE RESOURCES
        • Accounts Payable
          Finally! The trick to securing greater T&E compliance
          Benefits
          Rooting out folks who don’t belong on your health plan: A 6-point dependent audit checklist
          IT
          3 costly misconceptions about biz email compromise
          Credit and Collections
          Collecting via email: 4 must-make moves in your subject line
          Accounts Payable
          5 Tough-to-spot signs that an invoice is fake
  • PREMIUM CONTENT
        • Staff management
          120 Proven Communications Tips for Today’s CFO
        • Payroll
          Handling Nonexempt Employee Pay: Stay Compliant and Avoid DOL Audits
          Accounts Payable
          T&E Best Practices: Complete Guide to Ensure Compliance
          Payroll
          Payroll Best Practices: 4 Ways to Save Time and Money
        • Staff management
          Email Best Practices: A 6-Question Quiz
          Staff management
          Innovative Communications Strategies: An Email Case Study
          Staff management
          A 5-part Framework for Successful Workplace Communications
        • SEE MORE
          PREMIUM RESOURCES
  • CORONAVIRUS RESOURCES
  • Accounts Payable
  • Credit and Collections
  • Payroll
  • Accounting
  • Benefits
  • Finance Technology
  • More
    • Employment Law
    • Strategy
    • Policy and Culture
    • Fraud
    • Payments and Transactions
    • Budgeting and Forecasting
    • Banking
    • Staff Management
    • Cost Control
    • Supply Chain
    • IT

Bill would make student loan repayment a tax-free benefit

Jared Bilski
by Jared Bilski
February 17, 2017
  • Accounting
  • Benefits
2 minute read
  • SHARE ON

Student loan repayment benefits have become an increasingly popular tool for recruiting and retention in recent years and, if this bill passes, that trend is only likely to continue.

The bipartisan bill, The Employer Participation in Student Loan Assistance Act (H.R. 795), which was introduced by Rep. Rodney Davis (R-IL) and has an impressive 23 co-sponsors, would alter Section 127 of the Internal Revenue Code.

Currently, Section 127 allows employees to exclude up to $5,250 per year in employer-provided education assistance from their taxable income.

This tax break applies to tuition, fees, books, supplies and even equipment. Noticeably absent from that list: student loan repayment benefits.

And that’s what Davis’ bill aims to change. If the bill passes, the annual tuition reimbursement amount of $5,250 would also apply to student loan repayment benefits.

Where the bill stands

The bill was introduced in the House and referred to the House Ways and Means Committee and seems to have garnered support from both Democrats and Republicans as well as prominent HR organizations like the Society for Human Resource Management (SHRM).

Kathleen Coulombe, a SHRM senior advisor of government relations, commented on the bill by saying:

“Both Republicans and Democrats alike see the value in incentivizing student loan repayment. Expanding Section 127 is a natural fit, whereby employers are able to offer a unique flexible benefit, and employees are able to offset the cost of education and training.”

Coulombe went on to say that including student loan repayments in Section 127 of the Code “would assist employers in attracting employees — many of whom are Millennials — to the workplace.”

A growing minority

Currently, just three percent of employers currently offer student loan repayment benefits to employees.

But the growing interest and increased access to student loan repayment vendors makes it highly likely a boom is coming in this benefits area.

A number of firms like Tuition.io and Student Loan Genius have popped up recently to helps firms administer student loan repayment benefits.

Tuition.io, for example, offers an interface that employers can customize to handle payments and taxation requirement and Tuition.io handles everything else. Employees never touch the money; it goes directly from the employer to loan payment. According to Tuition.io, employers’ average per-paycheck contributions to workers’ student loans are generally in the $50-$200 range.

This story first appeared on our sister site, HR Benefits Alert.

Keep Up To Date with the Latest Finance News

With CFO Daily News arriving in your inbox, you will never miss critical stories on accounting, benefits, payroll & employment law strategies.

Sign up for a free CFO Daily News membership and get our newsletter!
  • This field is for validation purposes and should be left unchanged.
CFO Daily News Logo
  • ABOUT CFO DAILY NEWS
  • ADVERTISE WITH US
  • WRITE FOR US
  • CONTACT
  • Accounting
  • Benefits
  • Payroll
  • Policy and Culture
  • Employment Law
  • Fraud
  • Finance Technology
  • Accounts Payable
  • Credit and Collections
  • Strategy
  • Payments and Transactions
  • Budgeting and Forecasting
  • Banking
  • Staff Management
  • Cost Control
  • Supply Chain
  • IT

CFO Daily News, part of the SuccessFuel Network, provides the latest Finance and employment law news for Finance professionals in the trenches of small-to-medium-sized businesses. Rather than simply regurgitating the day’s headlines, CFO Daily News delivers actionable insights, helping Finance execs understand what Finance trends mean to their business.

Privacy Policy Terms of Service
Copyright © 2021 SuccessFuel

WELCOME BACK!

Enter your username and password below to log in

Forget Your Username or Password?

Reset Password

Lost your password? Please enter your username or email address. You will receive a link to create a new password via email.

Log In

preloader