UET Online Magazine

Welcome UET Members

As part of our ongoing efforts to share information, the UET Online Magazine features important announcements on events and learning opportunities for bargaining unit employees. Listed below are links to specific timely information for UET Members. Create or update your User Profile by clicking MyUET to receive program updates and the UET Online Magazine by e-mail.

Issue 5: 6/13/2008

A better way to determine taxes on educational assistance benefits

A better way to determine taxes on educational assistance benefits

The Union Education Trust determined that what had happened to many UET participants in fall 2007, when they were hit with an unexpected tax bill, should not ever happen again. A permanent fix was needed – one that enabled members to proactively figure out their tax obligations and ensure that they didn’t needlessly pay taxes that they shouldn’t.

So, the UET and the State developed a process to come up with a solution that makes sure that all bargaining unit members are treated right when it comes to tax time. It puts you back in control of your taxes. After reviewing the tax law with legal counsel and state representatives, UET designed a tax exemption form for members to fill out, get it signed by a state-designated agency HR representative and submit to UET to keep your records up-to-date.

With this form, the state will now account for the money paid for educational assistance on a monthly basis, so taxes won’t pile up at the end of the year. As the amount adds up to more than $5,250, the state may begin deducting taxes.

UET participants may fill out the Educational Benefit Tax Exemption Form to designate that a particular course is work related and therefore exempt from income tax.

The State’s part in the process is designating the appropriate HR representatives in each agency to sign the form, after reviewing the submitted documentation and ensuring that it complies with the IRS code, which is detailed in IRS publication 970.

In addition to driving this change, the UET also invested in its own technology update to record the data and to accurately generate the required reports.

The UET also has developed resources for bargaining unit members to use to decide whether or not they need to submit this form. The tax-exempt maximum may not affect every UET participant but all should review the information to make that decision. There are several situations that can affect UET participants who might not expect it. Read about the process here.

Download and print the Educational Benefit Tax Exemption Form
Download and print the FAQ Sheet & Flowchart