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Overview: Tax deferred education accounts, also known as 529 plans, are tax deferred savings accounts that individuals use to pay for tuition, books, administrative fees and other college expenses. There are two types of tax deferred education accounts:
Account owners do not pay federal taxes on the earnings in the account, and distributions for tuition payments are not taxed. If the funds are spent on something other than educational expenses, that money may be subject to income taxes and a 10 percent federal tax penalty.
Author: Tracy Morley, SPHR, Legal Editor
Employers should strive to provide employees with career development opportunities as part of the organization's overall talent management and succession planning efforts. Employers may use data from this form to inform strategic decisions regarding the organization's overall training and development programs, to explore available educational partnerships and to align total rewards programs to business goals.
Attracting, motivating and retaining talent is critical to an employer's short- and long- term success. This section assists HR professionals in implementing a comprehensive, integrated total rewards strategy that can help achieve those important objectives.
HR guidance on understanding tax deferred education accounts.