NEA Collective Bargaining and Member Advocacy
Did you Know ? ….A Time Sensitive Benefit for YOU
Did you know that section 2206 of the CARES Act allows employers to contribute up to $5,250 toward an employee’s student loan balance tax free?
This tax-free benefit ends (funds must be sent by) January 1, 2021 but could be extended by Congress.
Before the CARES Act, employer contributions to student loans were considered taxable income for the employee, but for the rest of 2020, employer-funded student loan payment assistance does not count as taxable income.
Payments can be made directly to the lender or to the employee.
So what can you do about it ?
Negotiation/board policy and advocacy considerations…as a value to your Association, affiliates may want to make plans to negotiate the above benefit and consider the following items:
- MOU…even if you’re currently not in scheduled full negotiations, consider bargaining a Memorandum of Understanding (MOU) for new employer contributions to employee student loans or to allow employees to take some of their compensation as tax-free student loan contributions or taxable income if the tax-free provision expires without extension.
- Prepare for advocacy…pending other language in your contract or board policy that might speak to such protections and rights as federal laws not being violated or being consistent with federal laws, if the employer denies a member (or members) the above benefit, you may want to consider filing individual or class action grievances.
NEA Collective Bargaining and Member Advocacy with NEA Office of General Counsel