Does this count as income?

klinked · 07-28-2006, 11:21 PM

One of the benefits offered at my company is $5250/year offered as tuition reimbursement for college students. DH and I both work for this company and both go to school and so earn the extra $10500 a year.

This is tax free income on my return but we don't get it unless we are in school.

If I go through a first time homebuyers program that has income limits will this money be counted toward that limit?

My choice will be quit school to qualify or stay in school and maybe take a higher interest rate.

roybean · 07-28-2006, 11:31 PM

Trying asking Quixote: he's good and will respond promptly;
http://www.infinitecredit.com/forums...read.php?t=166

klinked · 07-28-2006, 11:53 PM

Thanks, I sent him an email. I'll post his answer when he responds. cross your fingers

roybean · 07-29-2006, 12:57 AM

Ok, I have them crossed for you, but he's good. Don't worry.

klinked · 07-29-2006, 11:46 AM

Quixote is on the ball!. He might be my Plan B. You always gotta have a Plan B

Hi Klinked!

Thanks for touching base with me. You'd have to check with the specific state program, but I would guess that it would depend on how it is shown on our W-2's. If it's shown as income, you're toast. If it's shown as an expense reimbursement, there is probably hope, but again, check with the administrators of the particular program.

Either way, if income is in line, and credit is in shape, there are loan programs out there for you.

One caveat regarding down payment assistance programs: read it very carefully. Many, but not all of these type of grants come with strings like "shared equity"; meaning the government entity sponsoring the program gets half the appreciation in your home when and if you sell. Sometimes there is a sunset on this provision; i.e. if you stay in the home for a certain number of years, then the condition goes away. Just read it very carefully so you know what you're getting into. I never would have thought of this one!

If I can be of any assistance in helping you get qualified for your purchase, or you need a local Realtor referral, please feel free to give me a shout.

Best Regards,

Quixote

roybean · 07-29-2006, 02:26 PM

See; I told you. He's good ain't he? And he can help you no matter where you live.

Hedwig · 07-30-2006, 04:55 AM

It shouldn't show on your W-2 at all, so it isn't income. It's an expense reimbursement the same way travel expenses are a reimbursement.

The $5250 figure is the amount that the IRS allows to be deducted from income if you're paying for it yourself, so that's the number that most employers use. After that, any reimbursements would be considered income and taxes would have to be withheld (unless you meet certain other tests, just as the IRS allows more deductions in certain cases).

klinked · 07-30-2006, 11:42 AM

I like that answer! I will double check on Monday but I think you've nailed it.

Qtip · 07-30-2006, 11:58 AM

I did not know that there where so many strings attached to the downpayment assistance programs. Learn something every day!

klinked · 07-30-2006, 02:03 PM

I will definitely be returning to post as I go to get feedback. I want to make sure my eyes are wide open as I do this

Quixote · 08-03-2006, 01:57 AM

Just ran across this... Good thing I was wearing my polite clothes that day...

I would have been more accurate if I had said that if this is shown as a flat allowance, rather than reimbursement, there may be some hope... Otherwise, I would have to agree with Hedwig...

Hiya, BTW, Hedwig!

Hedwig · 08-03-2006, 12:23 PM

Hi, Quixote!

You need to check by more. We're starting to get more mortgage questions.