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So the plan is... >> Under the new GOP tax plan, however, those tuition waivers would be taxed as regular income... Sensationalist headlines aside... Why is this being targeted in the new tax plan? Usually I can find something with a quote from someone that explains.
It's not really being targeted. It's just part of an across the board change to get rid of or reduce tax deductions of all kinds.
So the plan is... >> Under the new GOP tax plan, however, those tuition waivers would be taxed as regular income... Sensationalist headlines aside... Why is this being targeted in the new tax plan? Usually I can find something with a quote from someone that explains.
The reason is to balance rate decreases at the top percentile, to decrease the corporate tax rate, and to finance lost revenues from dropping the estate tax. The rest of the reasons people state are needlessly obtuse or purposefully deceptive. There’s one mathematical reason, it’s because this bill can not increase deficit past a certain amount, and so to balance giveaways to the rich we must demand more of every oth…
Earlier quoted context omitted.
Okay, I think I understand your position now and I agree it's self-consistent, even though I disagree. Still, good luck to the US remaining a scientific leader with this change.
Is your logic here that major research universities would maintain the same fee structure and allow less qualified wealthy students to assume the spots lost by students who can't afford the tax change? Universities compete for research talent. Won't they simply adjust their fee and stipend structures to accommodate this change?
Universities compete with each other for research talent, but they also compete with private industry for graduating BS/BA students. If the amount of money flowing to higher education in general is reduced, it may be harder for graduate schools to compete for the best students against private industry, even though they continue to compete as best they can with each other.
Under the logic of the tax code, tuition waivers should obviously be taxable. The University is basically paying for graduate student labor with a vastly below-minimum wage stipend, along with a very valuable free education. "In kind" benefits (such as the use of an apartment) provided by an employer are generally taxable. That doesn't mean tuition waivers should be taxed. It just means you have to be intellectually…
Earlier quoted context omitted.
I don't follow your line of thought. How is the government picking up the tab? The government isn't making any payment back to the institution.
I believe what Overtonwindow meant was that the cost of education has gotten out of control primarily because whenever the government guarantees debt ( cough housing cough ) it creates a perverse incentive where the lenders profit by bigger loan values and the schools profit by jacking up the cost of their service for which the loans are issued. Essentially, there is far less of a check and balance on the price of th…
You are talking about undergraduate tuition and the article is talking about graduate/PhD tuition, which are entirely separate issues here.
Earlier quoted context omitted.
As a former Ph.D. student and now graduate, I would have to say the title is is not sensationalist at all. This aspect of the tax plan will raise additional funds (to at least partially offset the magnitude of the revenue reductions). Where do you think those funds are going to come from? They come from the graduate students who will now be taxed on these tuition waiver amounts. It is extremely facile to just waive a…
> I would have to say the title is not sensationalist at all It's appalling that you don't find the title extreme. No way will a tax plan completely destroy higher education as we know it. > Where do you think those funds are going to come from? Its simple. The schools are going to start including the cost of taxes when covering the grad students tuition costs. For example, if tuition is 50k + a tax of 10k. The schoo…
Under the logic of the tax code, tuition waivers should obviously be taxable. The University is basically paying for graduate student labor with a vastly below-minimum wage stipend, along with a very valuable free education. "In kind" benefits (such as the use of an apartment) provided by an employer are generally taxable. That doesn't mean tuition waivers should be taxed. It just means you have to be intellectually…
Under the logic of the tax code, tuition waivers should obviously be taxable. The University is basically paying for graduate student labor with a vastly below-minimum wage stipend, along with a very valuable free education. "In kind" benefits (such as the use of an apartment) provided by an employer are generally taxable. That doesn't mean tuition waivers should be taxed. It just means you have to be intellectually…
It's somewhat difficult to find high-quality statistics on graduate students in the United States, but I tried to look up some information for context. The following is not an random collection:
It appears that more than a third of doctoral students in the United States are not US citizens (compared to 7% of the overall population). Perhaps a slight majority (~52--53%) of doctoral students are female. Graduate students are also slightly more likely to be non-white than the general population. The majority are under 32 (of course).
Earlier quoted context omitted.
The default tax rule in the U.S. is that any benefit you receive, in any form, is earned income and taxable. Layered atop that default rule are a long list of exceptions, which are generally categorized as (1) exemptions and (2) deductions. If you attend a Ph.D program where the advertised tuition is $30k per year, and you get a tuition waiver (or w'ever it's called), the default tax rule says that you still earned i…
If this goes through, there will be some huge adjustments for graduate students and the research universities that depend on them. With no phase in, this could really hurt current students who thought that they would be getting $15k a year to live on and now have almost nothing, if they have to pay tax on the $30k the university is "giving" them in tuition. If you are have way through a degree program what do you do?…
I'm sure accountants can figure this one out.