Faculty and staff members are encouraged to review the following Information regarding updates in the BYU tuition benefit and reminders regarding the operational processes and limits of the benefit:
BYU-Idaho Dependent Tuition Benefit
Arrangements have been made with BYU-Idaho that will allow the dependent tuition benefit to be paid at the start of the semester (similar to BYU-Provo) rather than as a reimbursement after the end of the semester. The advantage will be that the student will only have to pay one-half of the tuition to BYU-Idaho at the start of each semester.
In order to authorize payment to BYU-Idaho, the Benefits Office at BYU-Provo (D-240 ASB, ext. 2-4496) must be contacted prior to the start of every semester and provided with (1) the name of the student, (2) the birth date of the student and (3) the name and BYU ID number of the parent who is the BYU employee.
Taxation of the BYU Tuition Benefit
Under provisions in Section 117 of the Internal Revenue Code (IRC), BYU employees, along with eligible spouses and dependents, can use the BYU tuition benefits for undergraduate BYU classes without having to pay taxes on the value of the tuition. In most cases, under the terms of IRC Section 132, employees can also take graduate classes at BYU without having the benefit taxed, to the extent the classes relate to their current job. However, the only way for spouses to exclude the value of graduate tuition benefits from taxable wages of the employee is for those spouses to be employed as teachers or researchers for the University.
BYU is required by the IRS to withhold appropriate taxes on taxable benefits. Even though the taxable benefit is for the spouse's tuition, the related withholding tax is withheld from the employee's salary because the benefit is available through the employee's benefits plan.
Beginning Fall 2004, before the tuition benefit can be paid for each semester that an eligible employee's spouse takes graduate classes, the employee is required to complete a Tuition Taxation Form for Spouses Taking Graduate Classes and turn it in to the Benefits Office in D-240 ASB. That form outlines the options under the IRC. Any questions can be directed to the Benefits Office at ext. 2-4716. The tax form can be obtained from the Benefits Office or from the Benefits Services Web site at www.byu.edu/hr/benefits (click on Forms).
Eligibility Requirements
Eligibility for participation in tuition benefits for a particular semester or term is tied to the close of late registration for that particular semester or term. New full-time personnel are eligible for the tuition benefit for Fall 2004 if they are hired on or before the last day of late registration which is September 13, 2004. Spouses and dependents become eligible to receive tuition benefits when University personnel are at least age 30 with one year of eligible service, or have five years of eligible service. To be eligible for tuition benefits, individuals must meet admissions and registration requirements of the university.
Hours Limits for Employees
Full-time university personnel may register for no more than six credit hours each semester or four hours in a term. During spring/summer terms the hours limit total is six hours and may be divided into 3:3, 4:2, or 2:4. Normally, full-time University personnel will not be required to pay the cost of tuition for up to six credit hours each semester. Any full-time employees who wish to take more than six hours in a semester or more than four hours in a term must petition the Benefits Tuition Committee. The tuition benefit usually will not be paid until the issue is resolved. In any unusual cases where approval is given for employees to take more than six hours in a semester or two terms, the employees will be required to pay tuition for any class hours over the six-hour limit.
Approval for Daytime Class Attendance
Regular faculty, staff and administrative personnel wishing to take classes during daytime hours (7 a.m. to 5 p.m.) for credit or thesis hours need to (1) be properly admitted through the Admissions Office, (2) be registered for the classes and (3) have the written approval from their department chair or supervisor and the dean or director over their area. Applications for approval (Request for Daytime Class Attendance forms) may be obtained from the Benefits Office, D-240 ASB, or online at www.byu.edu/hr/benefits (click on Forms). The completed form must be returned to the Benefits Office and receive approval before the daytime tuition benefit can be paid.
Limits of the Tuition Benefit for Dependents
Tuition benefits at BYU-Provo or BYU-Idaho for eligible dependents (regardless of marital status) are limited to (1) the completion of the first undergraduate degree, (2) completion of 152 BYU-Provo/BYU-Idaho credit hours, or (3) age 30, whichever occurs first. Credit hours available from testing for language credit, advanced placement credit, or transfer credits from other institutions do not count against the 152 BYU credit limit.
For eligible dependents, the tuition benefit will be automatic until 130 hours have been reached. After that the dependent will need to contact the Benefits Office at D-240 ASB, ext. 2-4496 to coordinate the remaining tuition benefit. This makes the dependent aware of how many hours are still available under the 152-hour limit.
