On March 5, Reps. Sam Johnson (R-TX) and Richard Neal (D-MA) introduced H.R. 4137, the Employee Educational Assistance Act of 2012. SHRM, a strong proponent of this employer-provided benefit, was instrumental in garnering bipartisan support for this bill prior to its introduction – which happened to coincide with the start of the 2012 Employment Law & Legislative Conference.
Section 127 of the Internal Revenue Code allows an employee to exclude from income up to $5,250 per year in assistance provided by their employer for any type of educational course at the associate, undergraduate and graduate level. Congress has extended Section 127 nine times since it was created in 1978, most recently in 2010. Section 127 will expire at the end of this year unless Congress acts to renew it or make it permanent.
In recent years, there have been several attempts to make employer provided education assistance (Section 127) a permanent part of the tax code. Attempts to extend or make permanent any tax reduction will be difficult in the current political environment given concerns about the rising federal deficit. An extension or permanency of Section 127 will ultimately be part of a larger tax reform package, likely considered near the end of this year, along with other Bush Era tax extensions.
On March 7, over 200 SHRM members took their message to Capitol Hill, urging legislators to permanently extend Section 127 of the tax code. In meeting with legislators, SHRM members urged their representatives to co-sponsor H.R. 4137. Coinciding with the March 7 Hill Day, SHRM launched a comprehensive advocacy campaign for members not participating in this year’s conference that included a letter writing campaign and in-district meetings with members of Congress. SHRM co-chairs the Coalition to Preserve Employer Provided Education Assistance – a broad-based collection of groups representing business, labor and educational groups organized in support of this valued employee benefit.