Congressional tax cuts will be painful for UW students
Tax cuts were the topic of discussion when UW President Ana Mari Cauce met with Washington representatives Denny Heck (D-10th) and Dave Reichert (R-8th) on Nov. 14.
The same day, Cauce posted a breakdown of the potential ramifications for the UW and other schools, starting with the bill that would pass the House two days later.
Cause writes that the H.R. 1, otherwise known as the Tax Cut and Jobs Act, will gut several programs that make it possible for low-income students to afford college.
First, the bill takes away the student-loan interest deduction, which accounts for an average savings of $88 per tax filing according to The Pew Charitable Trusts. While that may not seem like much in the grand scheme of things, $88 can mean the difference between affording textbooks for the quarter.
Second, the House bill would get rid of the provision in the tax code that enables employers to offer up to $5,250 in tuition assistance without it counting toward that employee’s income. That will mean big tax hikes for many low-income, hourly-wage students, including UW employees.
The provision of the House bill that has gotten the most attention though, is the elimination of the tuition waiver for graduate students that would put those students on the hook for paying full taxes on any tuition assistance they receive up to the full cost of attendance. Cauce stipulates that more than 7,000 UW students would be affected.
Both bills will do away with the Lifetime Learning Tax Credit, which helps students and their families offset the cost of attending college, and can be used for as many years as needed until the family income surpasses the program cap.
They also both cancel tax-exempt bond options that universities, like the UW, rely on to save students money on services like housing and parking, which can then be applied to supported research projects.
Cauce’s concerns were echoed in an op-ed by former UW Graduate and Professional Student Senate President Charles Plummer, where he took two Foster School professors to task on a Wall Street Journal article they co-wrote that trivialized the tax cuts’ impact on colleges.