STATE OF CONNECTICUT
THE STATE COMPTROLLER
MEMORANDUM NO. 2001-20
May 8, 2001
TO THE HEADS OF ALL STATE AGENCIES
|ATTENTION:||Chief Administrative and Fiscal Officers, Business Managers, and Payroll and Personnel Officers|
|SUBJECT:||Employee Graduate Tuition Reimbursement Payments|
Internal Revenue Code (IRC) Section 132, "Working Condition Fringe", and Section 1.162-5, "Expenses for Education", qualifies some reimbursements as a working condition fringe benefit.
III. DETERMINATION OF REPORTABILITY
A. Non-Reportable Graduate Courses
If the graduate course is not required for your current position, or the course maintains or improves skills needed in your current position, it is non-reportable.
This includes refresher courses, courses on current developments, and academic or vocational courses.
NOTE: Non-reportable graduate course reimbursements are not included in employee's W-2 statement and not subject to Federal or State withholding taxes.
B. Reportable Graduate Courses
Graduate courses taken to meet the minimum educational requirements for an employee's current position are reportable. Graduate courses that are a part of a program of study that can qualify for a new trade or business are reportable, even if the individual is not seeking a new job.
Review courses to prepare for the bar examination or the certified public accountant (CPA) examination are reportable, because these courses may qualify an employee for a new profession.
NOTE: Reportable tuition reimbursements are included in the employee's W-2 statement and are subject to Federal or State withholding tax.
IV. REQUESTS FOR PAYMENT
The following procedures are to be used when processing employee graduate tuition reimbursement payments:
A. Non-Reportable Tuition Reimbursements - Agency Funds
Payments that meet the criteria outlined in Section III. A are non-reportable, and the processing of these graduate tuition payments, using agency funds, must be submitted on form CO-17XP-PR and processed through the payroll system using D/OE Code 1T - Non-Reportable.
B. Reportable Tuition Reimbursements - Agency Funds
C. Fund 9916 - Reportable Graduate Tuition Reimbursements
D. Fund 9916 - Non-Reportable Graduate Tuition Reimbursements
Please direct questions to the Office of the State Comptroller as follows:
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