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PRICE WATERHOUSE: EMPLOYEES MUST FILE IRS FORM TO RECEIVE EDUCATIONAL BENEFITS REFUND

 WASHINGTON, Oct. 22 /PRNewswire/ -- Workers wishing an income tax refund for taxed 1992 employer-provided educational expenses, must file a Form 1040X with the IRS, Price Waterhouse officials said.
 The Internal Revenue Service (IRS) reinstated the tax exclusion for employer-provided educational benefits and issued specific guidelines for filing for refunds of 1992 income and employment taxes paid on such assistance. The exclusion is retroactive to July 1992, said Elaine Church, a benefits analyst with Price Waterhouse.
 The 1040X must be accompanied with a corrected, employer-provided 1992 Form W-2, that properly reflects 1992 wages. On or with the Form 1040X, the employees must include their name, address, social security number, the notation "1992 tax year," their signature and a copy of the Form W-2c.
 Processing of the refund will be expedited if the person filing writes "IRC 127" in the top margin of the form, Church said.
 Employers may refund excess 1992 employment taxes withheld, directly to employees. When such refunds are made, the employer may recover the refunded amounts and any overpayments of their employment taxes by offsetting them against their next deposit of withheld income and employment taxes.
 This offset is obtained by filing Forms 941 and 941c and is calculated without interest.
 Instead of making refunds, the employers and workers can get separate refunds by filing a Form 843 with the IRS; however, the employer needs the affected employee's consent to receive its refund, Church said.
 The refund is paid to the employer with interest but interest is paid only on overpayments of the employer's 1992 employment taxes, calculated from April 15, 1993.
 Additionally, the employer will receive a refund and interest only after the IRS processes the Form 843. The employer can immediately reduce its withholding and employment taxes it pays when it files Form 941.
 "Thus to determine the more advantageous course of action, an employer should weigh the benefit of receiving interest on these amounts, against the administrative burdens of obtaining consents from employees," Church said.
 More information is available by contacting Betsy L. Freeman, Price Waterhouse at 202-728-9781.
 -0- 10/22/93
 /CONTACT: Betsy Freeman, marketing communications manager, of Price Waterhouse, 202-728-9781/


CO: Price Waterhouse ST: District of Columbia IN: FIN SU:

DT-PB -- DC036 -- 5920 10/22/93 17:04 EDT
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Publication:PR Newswire
Date:Oct 22, 1993
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