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IRS issues updated FAQs regarding educational assistance programs

Updates reflecting amendments under OBBBA

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April 20, 2026

The U.S. Treasury Department and IRS today released FS-2026-10, containing updated FAQs regarding educational assistance programs.

As explained in a related IRS release—IR-2026-55 (April 20, 2026)—an employee’s gross income does not include benefits provided under a section 127 educational assistance program, up to $5250 per calendar year. The “One Big Beautiful Bill Act” (OBBBA) amended section 127 to index the $5250 cap for inflation for tax years after 2026 and also made certain other changes.

The updated FAQs, which supersede the FAQs previously issued in FS-2024-22, provide revised information about educational assistance programs generally (including how the rules apply to certain qualified education loans), updates related to the OBBBA amendments, and a modified sample plan. 

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