[PW] Re: Question about Qualified Tuition Reduction

[John P. Dyson]

I was director of graduate studies in my department for many years. The 
university offered prospective qualified graduate students a teaching 
assistantship (called an associate instructorship at my institution) at 
a very modest wage. As additional incentive to accept the small 
stipend, students were also offered a tuition waiver that excused them 
from the cost of classroom instruction, requiring only that they pay 
"activity fees." (I was always amazed at what qualified for that 
label.) The excused tuition went untaxed. I suspect that it was 
tax-free because all across the country graduate fee remissions were in 
a sense funny money. The choice was never enroll as a full-time student 
and pay full tuition fees OR accept a teaching assistantship and be 
spared. It was offer me a fee remission and assistantship OR count me 
out. Our department had over 100 TAs in many years. Occasionally some 
administrator looking for more money would accuse us of depriving the 
university of income by giving every assistant a fee remission. We 
deprived the university of nothing: no fee remissions equalled no 
graduate enrollments.

John Dyson
Spanish and Portuguese
Indiana University


Quoting Susan White <swhite at uat.edu>:

>
> 	Does anyone out there know about "Qualified Tuition Reductions"
> for College employees seeking graduate degrees at their institution? I
> am trying to understand what the following means and could use some
> help, as a colleage was asking about how this impacts them...
>
> 	In the IRS Tax Benefits for Education (970, Cat. No. 25221V) -
> There is a statement that reads "Graduate education. Tuition reductions
> for graduate education are considered "qualified" and are tax free if
> they are provided by an eligible educational institution to a graduate
> student *who performs teaching or research activ ities for that
> institution.* All other tuition reductions for graduate education are
> taxable."
>
> 	Much Thanks,
>
> Sue White
> Academic Librarian
> University of Advancing Technology
>
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