Tuition reimbursement is an employee benefit program offered by some companies that allows workers to pursue specific degrees, certificates, or courses, with the company contributing a set amount of money. In most cases, the program works by reimbursing the employee for classes after they have paid for the course. The amount of reimbursement varies by company, but the IRS limits tax-free benefits to $5,250 per year. Tuition reimbursement programs are a win-win for both employers and employees. Employers can invest in developing their workforce and improving retention while enjoying a tax benefit, while employees can further their education and build credentials, upping their earning potential.
To find out if a company offers tuition reimbursement, employees can talk to their manager or supervisor, ask their HR representative, or check their employee guides. Each company has its own rules for tuition reimbursement, and some programs will reimburse employees only if they attend certain colleges or universities, while others will send a payment for specific courses related to their job function. Tuition assistance programs may offer upfront financial assistance, while reimbursement programs pay employees back after they complete a course or semester.
Tuition reimbursement can be used to fund (or partially fund) an undergraduate or graduate degree program, job-related professional development courses, specific skill-building classes, or even educational courses that may not be specifically job-related. Receiving tuition reimbursement benefits should not prevent employees from being approved for loans or other aid.
Tuition reimbursement programs offer clear benefits to employees looking to upskill and advance, and those who take advantage of these programs know they can turn their employer’s financial support into a graduate degree that will carry them the rest of their professional career. Employers benefit from helping their workers achieve their professional goals, and many organizations with these programs report higher employee retention rates and use these plans to recruit new talent.
