An Illinois Congressman is urging employers to consider offering a new benefit that is aimed at reducing student loan debt.
13th District Representative Rodney Davis announced via a video message today, employers can now offer a new student loan tax benefit to their employee benefits package.
Davis’ Employer Participation in Repayment Act was included in the CARES Act and extended for five years in legislation passed last December.
In the video announcement, Davis says with workforce issues and student loan debt continuing to plague the economy, he hopes employers will offer the benefit.
“Under federal law, employers can make tax-free student loan payments up to $5,250 dollars per year for each employee who holds an eligible student loan. Lowering the payroll tax obligations for both you as an employer and your employees. Just like what many employers already offer for tuition assistance.’
Previously, if an employer wanted to offer student loan assistance as a benefit, those payments would be included in an employees’ taxable income. Davis says with this new provision, these payments can be tax-free up to the $5,250 per year amount.
Davis also announced a new webpage, rodneydavis.house.gov/studentloanbenefit, with more information for employers about how to sign up for the program.