Editorial Notes
Amendments
2020—Subsec. (c)(1)(B). Pub. L. 116–260 substituted “January 1, 2026” for “January 1, 2021”.
Pub. L. 116–136 added subpar. (B). Former subpar. (B) redesignated (C).
Subsec. (c)(1)(C). Pub. L. 116–136 redesignated subpar. (B) as (C).
2001—Subsec. (c)(1). Pub. L. 107–16, § 411(b), struck out before period at end “, and such term also does not include any payment for, or the provision of any benefits with respect to, any graduate level course of a kind normally taken by an individual pursuing a program leading to a law, business, medical, or other advanced academic or professional degree”.
Subsecs. (d), (e). Pub. L. 107–16, § 411(a), redesignated subsec. (e) as (d) and struck out heading and text of former subsec. (d). Text read as follows: “This section shall not apply to expenses paid with respect to courses beginning after December 31, 2001.”
1999—Subsec. (d). Pub. L. 106–170 substituted “December 31, 2001” for “May 31, 2000”.
1997—Subsec. (d). Pub. L. 105–34 amended heading and text of subsec. (d) generally. Prior to amendment, text read as follows: “This section shall not apply to taxable years beginning after May 31, 1997. In the case of any taxable year beginning in 1997, only expenses paid with respect to courses beginning before July 1, 1997, shall be taken into account in determining the amount excluded under this section.”
1996—Subsec. (c)(1). Pub. L. 104–188, § 1202(b), in closing provisions, inserted before period at end “, and such term also does not include any payment for, or the provision of any benefits with respect to, any graduate level course of a kind normally taken by an individual pursuing a program leading to a law, business, medical, or other advanced academic or professional degree”.
Subsec. (d). Pub. L. 104–188, § 1202(a), substituted “May 31, 1997. In the case of any taxable year beginning in 1997, only expenses paid with respect to courses beginning before July 1, 1997, shall be taken into account in determining the amount excluded under this section.” for “December 31, 1994.”
1993—Subsec. (d). Pub. L. 103–66 substituted “December 31, 1994” for “June 30, 1992”.
1991—Subsec. (d). Pub. L. 102–227 substituted “June 30, 1992” for “December 31, 1991”.
1990—Subsec. (c)(1). Pub. L. 101–508, § 11403(b), struck out at end “The term ‘educational assistance’ also does not include any payment for, or the provision of any benefits with respect to, any graduate level course of a kind normally taken by an individual pursuing a program leading to a law, business, medical, or other advanced academic or professional degree.”
Subsec. (d). Pub. L. 101–508, § 11403(a), substituted “December 31, 1991” for “September 30, 1990”.
1989—Subsec. (b)(1). Pub. L. 101–140, § 203(a)(1), amended par. (1) to read as if amendments by Pub. L. 99–514, § 1151(c)(4)(A), had not been enacted, see 1986 Amendment note below.
Subsec. (b)(2). Pub. L. 101–140, § 203(a)(2), amended par. (2) to read as if amendments by Pub. L. 100–647, § 1011B(a)(31)(B), had not been enacted, see 1988 Amendment note below.
Pub. L. 101–140, § 203(a)(1), amended par. (2) to read as if amendments by Pub. L. 99–514, § 1151(g)(3), had not been enacted, see 1986 Amendment note below.
Subsec. (b)(6). Pub. L. 101–140, § 203(a)(1), amended par. (6) to read as if amendments by Pub. L. 99–514, § 1151(c)(4)(B), had not been enacted, see 1986 Amendment note below.
Subsec. (c)(8). Pub. L. 101–239, § 7814(a), struck out par. (8) which read as follows: “Coordination with section 117(d).—In the case of the education of an individual who is a graduate student at an educational organization described in section 170(b)(1)(A)(ii) and who is engaged in teaching or research activities for such organization, section 117(d)(2) shall be applied as if it did not contain the phrase ‘(below the graduate level)’.”
Subsec. (d). Pub. L. 101–239, § 7101(a)(1), substituted “September 30, 1990” for “December 31, 1988”.
1988—Subsec. (b)(2). Pub. L. 100–647, § 1011B(a)(31)(B), substituted “there shall” for “there may” and “who are” for “who may be” in last sentence.
Subsec. (c)(1). Pub. L. 100–647, § 4001(b)(1), inserted at end “The term ‘educational assistance’ also does not include any payment for, or the provision of any benefits with respect to, any graduate level course of a kind normally taken by an individual pursuing a program leading to a law, business, medical, or other advanced academic or professional degree.”
Subsec. (d). Pub. L. 100–647, § 4001(a), substituted “1988” for “1987”.
1986—Subsec. (a)(2). Pub. L. 99–514, § 1162(a)(2), substituted “$5,250” for “$5,000” in heading and twice in text.
Subsec. (b)(1). Pub. L. 99–514, § 1151(c)(4)(A), added par. (1) and struck out former par (1) which read as follows: “For purposes of this section an educational assistance program is a separate written plan of an employer for the exclusive benefit of his employees to provide such employees with educational assistance. The program must meet the requirements of paragraphs (2) through (6) of this subsection.”
Subsec. (b)(2). Pub. L. 99–514, § 1151(g)(3), substituted “For purposes of this paragraph, there may be excluded from consideration employees who may be excluded from consideration under section 89(h).” for “For purposes of this paragraph, there shall be excluded from consideration employees not included in the program who are included in a unit of employees covered by an agreement which the Secretary of Labor finds to be a collective bargaining agreement between employee representatives and one or more employers, if there is evidence that educational assistance benefits were the subject of good faith bargaining between such employee representatives and such employer or employers.”
Pub. L. 99–514, § 1114(b)(4), substituted “highly compensated employees (within the meaning of section 414(q))” for “officers, owners, or highly compensated,”.
Subsec. (b)(6). Pub. L. 99–514, § 1151(c)(4)(B), struck out par. (6) which read as follows: “Notification of employees.—Reasonable notification of the availability and terms of the program must be provided to eligible employees.”
Subsec. (d). Pub. L. 99–514, § 1162(a)(1), substituted “December 31, 1987” for “December 31, 1985”.
1984—Subsec. (a). Pub. L. 98–611, § 1(b), amended subsec. generally, substituting “Exclusion from gross income” for “General rule” in heading, designating existing provision as par. “(1) In general” and adding par. (2).
Subsec. (c)(7). Pub. L. 98–611, § 1(e), substituted “allowed to the employee” for “allowed”.
Subsec. (c)(8). Pub. L. 98–611, § 1(c), added par. (8).
Subsec. (d). Pub. L. 98–611, § 1(a), substituted “December 31, 1985” for “December 31, 1983”.
Subsec. (e). Pub. L. 98–611, § 1(d)(3)(B), added subsec. (e).
Statutory Notes and Related Subsidiaries
Effective Date of 2020 Amendment
Pub. L. 116–260, div. EE, title I, § 120(b), Dec. 27, 2020, 134 Stat. 3051, provided that:
“The amendment made by this section [amending this section] shall apply to payments made after December 31, 2020.”
Pub. L. 116–136, div. A, title II, § 2206(c), Mar. 27, 2020, 134 Stat. 347, provided that:
“The amendments made by this section [amending this section and
section 221 of this title] shall apply to payments made after the date of the enactment of this Act [
Mar. 27, 2020].”
Effective Date of 1997 Amendment
Pub. L. 105–34, title II, § 221(b), Aug. 5, 1997, 111 Stat. 818, provided that:
“The amendment made by subsection (a) [amending this section] shall apply to taxable years beginning after December 31, 1996.”
Effective Date of 1996 Amendment
Pub. L. 104–188, title I, § 1202(c)(1), (2), Aug. 20, 1996, 110 Stat. 1773, provided that:
“(1) Extension.—
The amendment made by subsection (a) [amending this section] shall apply to taxable years beginning after December 31, 1994.
“(2) Graduate education.—
The amendment made by subsection (b) [amending this section] shall apply with respect to expenses relating to courses beginning after June 30, 1996.”
Effective Date of 1993 Amendment
Pub. L. 103–66, title XIII, § 13101(c)(1), Aug. 10, 1993, 107 Stat. 420, provided that:
“The amendments made by subsection (a) [amending this section and repealing provisions set out below] shall apply to taxable years ending after June 30, 1992.”
Effective Date of 1990 Amendment
Pub. L. 101–508, title XI, § 11403(d), Nov. 5, 1990, 104 Stat. 1388–473, provided that:
“(1) In general.—
Except as provided in paragraph (2), the amendments made by this section [amending this section and repealing provisions set out below] shall apply to taxable years beginning after December 31, 1989.
“(2) Subsection (b).—
The amendment made by subsection (b) [amending this section] shall apply to taxable years beginning after December 31, 1990.”
Effective Date of 1989 Amendment
Pub. L. 101–239, title VII, § 7101(c), Dec. 19, 1989, 103 Stat. 2305, provided that:
“The amendments made by this section [amending this section and
section 132 of this title] shall apply to taxable years beginning after
December 31, 1988.”
Amendment by section 7814(a) of Pub. L. 101–239 effective, except as otherwise provided, as if included in the provision of the Technical and Miscellaneous Revenue Act of 1988, Pub. L. 100–647, to which such amendment relates, see section 7817 of Pub. L. 101–239, set out as a note under section 1 of this title.
Amendment by Pub. L. 101–140 effective as if included in section 1151 of Pub. L. 99–514, see section 203(c) of Pub. L. 101–140, set out as a note under section 79 of this title.
Effective Date of 1988 Amendment
Amendment by section 1011B(a)(31)(B) of Pub. L. 100–647 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 1019(a) of Pub. L. 100–647, set out as a note under section 1 of this title.
Amendment by section 4001(a), (b)(1) of Pub. L. 100–647 applicable to taxable years beginning after Dec. 31, 1987, see section 4001(c) of Pub. L. 100–647, set out as a note under section 117 of this title.
Effective Date of 1986 Amendment
Amendment by section 1114(b)(4) of Pub. L. 99–514 applicable to years beginning after Dec. 31, 1987, see section 1114(c)(2) of Pub. L. 99–514, set out as a note under section 414 of this title.
Amendment by section 1151(c)(4), (g)(3) of Pub. L. 99–514 applicable, with certain qualifications and exceptions, to years beginning after Dec. 31, 1988, see section 1151(k) of Pub. L. 99–514, as amended, set out as a note under section 79 of this title.
Pub. L. 99–514, title XI, § 1162(c), Oct. 22, 1986, 100 Stat. 2510, provided that:
“(1) Subsection (a).—
The amendments made by subsection (a) [amending this section] shall apply to taxable years beginning after December 31, 1985.
“(2) Subsection (b).—
The amendment made by subsection (b) [amending
section 120 of this title] shall apply to years ending after
December 31, 1985.
“(3) Cafeteria plan with group legal benefits.—
If, within 60 days after the date of the enactment of this Act [
Oct. 22, 1986], an
employee elects under a cafeteria plan under section 125 of the
Internal Revenue Code of 1986 coverage for group legal benefits to which [former] section 120 of such Code applies, such election may, at the election of the taxpayer, apply to all legal services provided during 1986. The preceding sentence shall not apply to any plan which on
August 16, 1986, offered such group legal benefits under such plan.”
Effective Date of 1984 Amendment
Pub. L. 98–611, § 1(g), Oct. 31, 1984, 98 Stat. 3178, as amended by Pub. L. 99–514, § 2, Oct. 22, 1986, 100 Stat. 2095, provided that:
“(1) In general.—
Except as otherwise provided in this subsection, the amendments made by this section [enacting
section 6039D of this title and amending this section and sections 125, 3231, and 6652 of this title] shall apply to taxable years beginning after
December 31, 1983.
“(2) Subsection (d).—
The amendments made by subsection (d) [enacting section 6039D and amending this section and sections
125 and
6652 of this title] shall take effect on
January 1, 1985.
“(3) Subsection (f).—
The amendment made by subsection (f) [amending
section 3231 of this title] shall apply to remuneration paid after
December 31, 1984.
“(4) No penalties or interest on failure to withhold.—
No penalty or interest shall be imposed on any failure to withhold under subtitle C of the
Internal Revenue Code of 1986 [formerly I.R.C. 1954] (relating to employment taxes) with respect to amounts excluded from gross income under section 127 of such Code (as amended by this section and determined without regard to subsection (a)(2) thereof) with respect to periods during 1984.
“(5) Coordination with section 117(d).—
In the case of education described in section 127(c)(8) of the
Internal Revenue Code of 1986, as added by this section, section 117(d) of such Code shall be treated as in effect on and after
January 1, 1984.”
Effective Date
Pub. L. 95–600, title I, § 164(d), Nov. 6, 1978, 92 Stat. 2814, provided that:
“The amendments made by this section [enacting this section and amending sections
3121,
3306, and
3401 of this title and
section 409 of Title 42, The Public Health and Welfare] shall apply with respect to taxable years beginning after
December 31, 1978.”
Expedited Procedures for Refunds of Overpayments
Pub. L. 104–188, title I, § 1202(c)(3), Aug. 20, 1996, 110 Stat. 1773, provided that:
“The Secretary of the Treasury shall establish expedited procedures for the refund of any overpayment of taxes imposed by the
Internal Revenue Code of 1986 which is attributable to amounts excluded from gross income during 1995 or 1996 under section 127 of such Code, including procedures waiving the requirement that an employer obtain an
employee’s signature where the employer demonstrates to the satisfaction of the Secretary that any refund collected by the employer on behalf of the
employee will be paid to the
employee.”
Special Rule for Certain Taxable Years
Pub. L. 102–227, title I, § 103(a)(2), Dec. 11, 1991, 105 Stat. 1687, provided that, in the case of any taxable year beginning in 1992, only amounts paid before July 1, 1992, by employer for educational assistance for employee be taken into account in determining amount excluded under this section with respect to such employee for such taxable year, prior to repeal by Pub. L. 103–66, title XIII, § 13101(a)(2), Aug. 10, 1993, 107 Stat. 420.
Pub. L. 101–239, title VII, § 7101(a)(2), Dec. 19, 1989, 103 Stat. 2304, provided that, in the case of any taxable year beginning in 1990, only amounts paid before Oct. 1, 1990, by employer for educational assistance for employee be taken into account in determining amount excluded under this section with respect to such employee for such taxable year, prior to repeal by Pub. L. 101–508, title XI, § 11403(c), Nov. 5, 1990, 104 Stat. 1388–473.
Plan Amendments Not Required Until January 1, 1989
For provisions directing that if any amendments made by subtitle A or subtitle C of title XI [§§ 1101–1147 and 1171–1177] or title XVIII [§§ 1800–1899A] of Pub. L. 99–514 require an amendment to any plan, such plan amendment shall not be required to be made before the first plan year beginning on or after Jan. 1, 1989, see section 1140 of Pub. L. 99–514, as amended, set out as a note under section 401 of this title.
