Frequently Asked Questions About Tuition Reimbursement

Should You Get Tuition Reimbursement From an Employer?

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What Is Employer Tuition Reimbursement?

Employer tuition reimbursement, also known as tuition assistance, is a term used to describe money that is given to an employee by an employer to pay for education costs. The money may be used to pay for undergraduate education, graduate education, or post-graduate education. More than half of all companies offer some form of tuition reimbursement to their employees according to the Society for Human Resource Management.

 

How Much Will My Company Pay Toward My Education?

Tuition reimbursement programs and benefits can vary from company to company. Some companies will pay all of the costs associated with a degree program. Others will only pay for a percentage (such as 50 percent) or a specific dollar amount. For example, an employer might reimburse an employee for up to 50 percent of education costs up to $20,000. You can find out exactly how much your company will pay toward your education by looking in your employee handbook or visiting the human resources department at your company. 

How Long Do I Have to Wait for Reimbursement? 

Most companies that offer tuition assistance reimburse their employees after courses have been completed. In some cases, you may have to complete an entire degree program before getting reimbursed. This means that you will be expected to pay for your classes and your books upfront.

If you do not successfully complete the courses you signed up for, you may never see a refund. 

Are There Any Other Stipulations?

Getting the boss to pay for your education may seem like a good idea, but it is important to understand the stipulations of tuition reimbursement programs before enrolling in an academic program.

Remember, not all companies work tuition reimbursement the same way. Some require you to work part-time or full-time while attending school. For example, individuals who receive tuition reimbursement for executive MBA programs often work during the day throughout the week and attend classes in the evenings and on weekends. You may also be required to maintain a certain grade point average. For example, you may be required to maintain at least a 3.0 while enrolled in the program to receive full reimbursement. Make sure you are clear on the stipulations before you sign up.

What Happens If I Quit School?

Most companies do not offer tuition reimbursement out of the goodness of their hearts. They expect something in return. The majority will want you to stay with the company for a predetermined amount of time after graduation. Think twice before agreeing to this or anything else. If you renege on an agreement that you made, you could end up being liable for the full cost of your business school education.

Are There Tax Ramifications?

There are usually tax ramifications associated with tuition reimbursement. The money that you receive from tuition reimbursement might be considered income and could be taxed that way.

You should speak with an accounting professional to determine how tuition reimbursement might impact your individual situation. 

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Schweitzer, Karen. "Frequently Asked Questions About Tuition Reimbursement." ThoughtCo, Feb. 28, 2017, thoughtco.com/receiving-tuition-reimbursement-466727. Schweitzer, Karen. (2017, February 28). Frequently Asked Questions About Tuition Reimbursement. Retrieved from https://www.thoughtco.com/receiving-tuition-reimbursement-466727 Schweitzer, Karen. "Frequently Asked Questions About Tuition Reimbursement." ThoughtCo. https://www.thoughtco.com/receiving-tuition-reimbursement-466727 (accessed December 15, 2017).