Cares Act Student Loan Repayment Employer. This new provision benefits both the employee and employer. With the new cares act, employers can pay up to $5,250 toward student loans and this amount is tax free to the employee.
Hypothetically, if this amount is paid direct to the employee (taxes and retirement are also taken out of the lump bonus) and the employee takes $5,250 and pays that to the loan, can. Employer student loan assistance got some love in the cares act. The cares act and student loan repayment.
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(a) in general.—paragraph (1) of part 127 (c) of the internal revenue code of 1986 is amended by placing ‘‘and’’ on the finish of subparagraph (a), by redesignating subparagraph (b) as subparagraph (c), and by inserting. Cares act for student loans & employer repayment programs. This new provision benefits both the employee and employer. “the cares act simply amends section 127 of the tax code to incorporate provisions of the employer participation in repayment act.