Why does Deloitte pay GSAP reimbursement the way it does? Surely there is a more tax effective way

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It’s to make it cleaner and easier on the firm. Rather than track you down, potentially sue you to reclaim money given to the school, they just go through the regular payroll structure that exits today. Prior to the Trump tax law, GSAPers could actually write off most of their MBA costs, saved like $30k depending on your tax situation

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Yes, most other firms pay the school upfront to limit the tax burden on the employee. I can’t really speak to why Deloitte does it the way they do other than not wanting to take the one-time hit to cash flow by switching over to paying upfront. Maybe to keep the performance management “stick”? (Which frankly seems like a bad reason, since all GSAPers are supposed to be top performers.)

The way BCG structures it is they take out a loan co-signed by the student and BCG. If the student doesn’t return, BCG simply transfers the responsibility for the loan over to the student.

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The BCG approach makes a ton of sense. Wish Deloitte would do something similar

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I think it’s because of audit/independence requirements. This would e.g., restrict where you could intern

Agree, very inefficient and frustrating though

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That’s a great point; I hadn’t thought about that.

Also curious about this

What would be the alternative? Any lump sum given by the employer is going to be considered a bonus in the eyes of the gov 🙃

They could pay the school directly in theory but this would lock you before you had a chance to look at other places

Right, that’s what I meant. I think some firms might do that but don’t know for sure. Personally preferred the check.

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