In an effort to support employees with their ongoing education, HSA Bank announced it will begin offering a tuition reimbursement account (TRA) solution for plan sponsors to help workers pay for tuition, specialized training, and other costs associated with schooling.
The employer-funded tax savings program allows employers to determine which funds are eligible for reimbursement and annual reimbursement limits. This could include tuition, books and other required learning materials, fees associated with registration, labs, exams, and more. Once eligible expenses are approved, employees may be reimbursed on a tax-free basis up to the IRS annual limit of $5,250. Participants can sign up for a TRA at any point during the year, based on the employer’s plan.
The feature comes as more employees struggle with student loan debt, and as potential loan forgiveness sits in the hands of the Supreme Court. With tuition reimbursement tools, employers can ease worries of future debt and put their focus towards other savings strategies, such as emergency savings accounts and retirement planning.
“As student debt continues to weigh on minds long after graduation, employees can pursue education without the added worry of accumulating more debt when offered a tuition reimbursement account solution,” said Mark Haessly, managing director of product management at HSA Bank, in a statement to 401(k) Specialist. “TRAs not only minimize the stress of debt repayment, but allows employees to prioritize their future goals by allocating those critical dollars to alternative expenses, such as retirement planning and unexpected rainy-day funds. With a TRA in place, employees can focus on their career development and invest in their education.”
HSA Bank is the latest in a roster of organizations now offering benefit plans to assist with student debt repayment and reimbursement of tuition expenses. In March, Highway Benefits raised $3.1 million dollars in seed funding, solidifying its standing as a student loan repayment platform for employers to provide to their workers.
Retail giants have also partnered with financial institutions and firms to ease student loan debt burdens. Last year, Starbucks teamed up with Fidelity and Tuition.io to offer employee benefits programs aimed at lessening student debt burdens.
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