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My issue is similar to

Tax treatment of repaid tuition after employment termination

but I have not enough reputation to comment there.

Megacorp paid my tuition. They made the payment directly to the school and not me. The amount was not included on my W2 and I did not deduct educational expenses over the years.

Now I left the company, and I may need to pay back a portion of the amount that they paid towards my degree. The payback is requested because of "wage overpayment". Question: should I deduct this amount from my W2 income or should I claim an educational expense deduction?

How would I do the former if that is the right thing to do?

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    So what's different in your situation? Any reason why my answer there wouldn't apply to you as well?
    – littleadv
    Jun 3 '14 at 6:04
  • I reread your answer on that thread. According to it "I elected not to deduct" this expense over the years, so I cannot do anything now. Do I understand it? However the person asking indicated that the IRS allowed him to deduct. In my case the time frame is longer, the payments were made to the school (by the employer) over 5+ years. The repayment request says it is a wage overpayment while I never got the money directly. (I guess it could a be a non monetary wage benefit with exactly established value and it could be a different issue.)
    – Matyas
    Jun 3 '14 at 16:59
  • I am a bit worried that even if I do nothing on my return some info will be sent by the employer that triggers an audit and they will charge me not declaring wage for those 5+ years.
    – Matyas
    Jun 3 '14 at 17:01
  • so maybe you should edit your question to describe your situation more precisely and more coherently. There's a great difference between "last year" and "+5 years ago".
    – littleadv
    Jun 4 '14 at 2:25