The University Record, December 12, 1994

Tuition refunds taxable, effective Jan. 1

There’s unhappy news for U-M staffers who participate in the tuition refund program: As of Jan. 1, 1995, refund payments will be taxable.

The tuition program, including the tax-exempt status of the payments, is controlled by Section 127 of the Internal Revenue Code, which expires Dec. 31.

Tuition payments will continue to be made in accordance with Standard Practice Guide 201.69, but will be taxable. They will be included in the next scheduled paycheck following receipt of the Special Payment Form by the Uni-versity Payroll Office.

It is possible that Congress will retroactively reinstate Section 127 during 1995. If this occurs, the Payroll Office will make the appropriate changes in the tax status of the refund payments and will notify staff members.

All tuition refunds that have been finalized should be sent to the University Payroll Office, G395, Wolverine Tower 1279, so refunds can be included in the December payrolls and not subject to taxation.

Those with questions about the payment process should contact the Payroll Office, 764-8250. Those with other questions should contact the Employee Relations and Compensation Office, 763-2387.