Nevada will allow a 25% credit for matching employee contributions up to $500 (i.e., $125 credit) starting January 1, 2016. Illinois has had a similar tax break in effect since 2009. There’s no deduction or credit under federal law; the employer matching contributions are taxable compensation to employees. Whether or not receiving any tax credit, employers can facilitate employee savings for higher education by voluntary payroll withholding for this purpose.
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