Employer Participation in Repayment Act “In February, members of Congress introduced the Employer Participation in Repayment Act (H.R. 1043), which would let employers give tax-free student loan assistance up to $5,250 a year per employee. Both federal and private loans are eligible.
Intensifying employer education assistance claims to address the skills gap, which is holding back both workers and employers,” SHRM President and CEO Johnny Taylor, Jr. said in a statement.
When employers are able to help workers pay off student debt, more people will have confidence to pursue higher education and be better prepared to fill high-skilled fields.
The legislation would let employers give tax-free student loan assistance up to $5,250 a year per employee. That’s the same amount that Section 127 of the tax code now treats as tax-exempt for employer-provided tuition assistance
According to SHRM’s 2018 Employee Benefits survey of more than 3,500 HR professionals, just 4 percent of organizations offered taxable financial aid to help employees repay student loans. In comparison, about half of organizations provided tax-exempt undergraduate or graduate educational assistance.
The provision has generated both criticism and applause for allowing employers to take advantage of the tax break, with critics arguing the provision will only help high-income workers who already have jobs and are already able to pay off their student loans, while doing little for those who most need help. As it expires at the end of the year, the provision largely mirrors a piece of bipartisan legislation previously introduced by Sens. Mark Warner (D-Va.) and John Thune (R-S.D.), which gives companies the ability to pay up to $5,250 tax-free each year toward their employees’ student loans and deduct the contribution from their taxes. A companion bill was also introduced in the House.
In recent years, several prominent companies have begun offering the employee perk, from streaming service Hulu to health insurance giant Aetna, although most companies contribute much less than the annual limit of $5,250 included in the CARES Act.
According to WIKIpedia these are a type of employee benefit in the United Statee, employers pay back student loans on behalf of employees, at certain amount per month as decided by the employer. Companies are using this benefit as a way to attract and retain employees, especially millennial workers.[1] This benefit has grown as education debt has increased. According to the Washington Post, student debt has nearly tripled since the early 1990s and averaged $35,000 in 2015.[2]
Only about 3% of companies currently offer employer student loan contributions, according to a survey by the Society for Human Resources Management from June 2015.[2] Prominent companies that have announced this benefit include Fidelity Investments, PricewaterhouseCoopers, Natixis Global Asset Management, Kronos, NVIDIA and law firm Orrick, Herrington & Sutcliffe.[3][4][5] Companies may work with a vendor to administer these payments. The main vendors are IonTuition, PeopleJoy, Leaf Education Benefits, CommonBond, Peanut Butter, Tuition.io, SoFi, Gradifi, and EdAssist.[3] Employer student loan contributions used to be taxable as regular income in the U.S.[3] According to the Coronavirus Aid, Relief, and Economic Security Act, payments of student loan principal and interest by an employer to either an employee or a lender is not taxable to the employee if paid on or before December 31, 2020
In a nut shell not much is done by the employers in this directionas only les than 5 percent employers are really contributing or willing to contribute. Then how do we get out of this massive debt which is growing and growing as we talk. Universities and colleges have raised their tution fees as much as 200 percent by majority of universities and most of lower middle class americans have no means to pay for college fees and accommodation expenses.
According to Jon Marcus editor at hechingerreport.org as much as 25 percent of middle-class high school students who don’t plan on college said it was because of the expense. The inflation-adjusted published price of college tuition, fees, room and board between 1999 and this year increased 54 percent at private nonprofit and 78 percent at public universities and colleges, according to the College Board. The median income of middle-class families, when adjusted for inflation, Pew says, hardly budged during that general period of time.
“There has been a lot of concern about that group in the middle, which has only gotten greater as the costs have gone up,” said Karen McCarthy, director of policy analysis at the National Association of Student Financial Aid Administrators and a former university financial aid officer.
American middle class and lower middle class has lot of concerns for American educational system and fees.
The situation is not getting better by any means and employers not doing much to help their employees with their educational loans where would we turn and look for help.
Free Education Staffing dreams to help every American who works with us to find their dream job through recruitment service and our training program to fill certain jobs that are high demand and pay well within HealthCare industry and IT. Through our “Center Of Excellence” these are the centers where Fresh high school graduates and College grads can sign up for these courses provided by Free Education staffing to get on entry and mid level jobs such as Manufacturing technicians and ware house co Ordinator quality control incoming materials and data base management and Quaity Assurance fields. These courses are designed by industry experts on FDA guidelines and all aspects of drug manufacturing and day to to day responsibilities on job.
Our mission is not only to contribute to U S educational debt but also train American’s for high demand jobs that do not really require a college degree or no college degree so far teaches skills that are needed for these jobs.