Graduate College Policy
Taxability of Tuition and Fee Waivers Associated with Assistantship and Fellowship Appointments
Current tax law exempts Teaching Assistants (TAs), Research Assistants (RAs), and most Fellows from having to pay taxes on tuition and service fee waivers associated with these appointments. Students holding Graduate Assistantships (GAs) or Pre-Professional Graduate Assistantships (PGAs) will be required to pay taxes on tuition and fee waivers that exceed a value of $5,250 per calendar year.
Under the University's Educational Assistance Plan that is in compliance with Internal Revenue Code Section 127, $5,250 per calendar year in tuition and service fee waivers associated with GA and/or PGA appointments are excluded from taxable income. Each semester, GAs and PGAs whose tuition and fee waivers to date are valued at more than $5,250 will have withholding on the amount exceeding $5,250. The current tax withholding rate is 25% for federal tax, 5% for state tax, and, if applicable, 4.2% for Social Security and 1.45% for Medicare on the taxable portion.
For more information, students may contact the University Payroll Service Center at payinq@uillinois.edu or the Academic Human Resources Office at 217-333-6747 or the IRS Publication 970 www.irs.gov/pub/irs-pdf/p970.pdf, chapters 12 and 13.
February 2003, March 2011