IRS updates KPMG-relevant education benefit rules, $5,250 exclusion stays through 2026

KPMG employees who rely on tuition reimbursement, credentialing support or student-loan help kept a valuable tax break intact this spring: the first $5,250 of qualifying educational assistance stays excluded from gross income for 2025 and 2026. The Internal Revenue Service said the updated rules, issued in FS-2026-10 and IR-2026-55 on April 20, also cover certain student-loan payments, including principal and interest, under a revised section 127 framework.

That matters inside a firm like KPMG, where professional development is part of the job as much as a perk. The firm’s public careers materials highlight a CPA training and mentorship program with tailored support for eligible employees pursuing CPA Canada’s PEP or a CPA-accredited post-undergraduate program, along with technical accounting and finance training, executive education and custom learning portals. For employees juggling busy season hours, promotion pressure and licensure requirements, whether a benefit is tax-free or taxable can change the real value of the package.

The IRS said the April update revised background language, renumbered items and added a modified sample plan to reflect amendments in the One Big Beautiful Bill Act, which was signed into law on July 4, 2025, as Public Law 119-21. The agency also said the $5,250 exclusion will be adjusted for inflation for tax years beginning after 2026. For 2025 and 2026, qualifying assistance should not be included in Form W-2 box 1 wages, a detail payroll teams cannot afford to miss if they want reimbursement programs to work as intended.

The practical takeaway for KPMG’s HR, payroll and tax teams is that education benefits need a fresh review, not a copy-paste from old plan language. The IRS said educational assistance programs are separate written plans under section 127, and Publication 15-B carries that same requirement. That means employers need to check whether tuition support, exam fees, books, supplies, equipment and student-loan repayment are being routed through a plan that actually qualifies, and whether owner-employee limits are being observed where relevant.

For KPMG workers, the update lands in everyday terms: lower taxable wages, cleaner payroll reporting and less risk that an education benefit meant to build a career turns into surprise compensation income. For a firm that sells expertise and expects employees to keep adding credentials, the tax treatment of those benefits now matters as much as the benefit itself.