Colleagues and Graduate Students,
The most recent proposed Federal Tax Reform legislation has generated much discussion among faculty, staff and graduate students about the impact on the higher education sector. While the legislation can still be fluid until it is voted upon by both the House & Senate, and signed by President Trump, what we have now as information from the National Association of Independent Colleges and Universities on what has been presented is as follows for what was retained, meaning no changes to their current status:
Student Aid & Family Benefits
· Student Loan Interest Deduction was RETAINED.
· The American Opportunity Tax Credit was RETAINED
· Lifetime Learning Credit was RETAINED
· IRC Sec. 117(d)5 graduate student tuition remission benefits were RETAINED.
· IRC Sec. 117(d) college employee tuition remission benefits were RETAINED.
· IRC Sec. 127 – employer-provided tuition assistance – was RETAINED.
Charitable Giving & Institutional Benefits
The Charitable Deduction was RETAINED, however, the overall effects of the other tax rate reductions may influence charitable giving so the impact is still unknown.
The IRA Charitable Rollover was RETAINED.
A new Endowment Tax on certain private colleges and universities using the Senate formula of $500,000 per FTE was ADDED. The tax itself was LOWERED from the original proposed 2% to 1.4%. Through six rewrites from its original introduction in the House, the tax transitioned from affecting 250 private colleges to affecting approximately 32 private colleges. Based on the size of our endowment and the number of students we have, Clarkson is not among those 32 institutions at this time.
In other legislative proposals, it may be prudent to continue to understand and be aware of what is included in the PROSPER Act, which reauthorizes the Higher Education Act last updated in 2008 (Read More Here with links from the American Council On Education) as it again has some provisions that will change how federal work study and financial aid is administered to students including borrowing limits on federal loans.
You may also be following the next steps following the FCC decision to end net neutrality and sharing your opinion with your elected officials. New York State is among those States that has been reported on its plan to sue the FCC over the decision.
If you have questions, please feel free to reach me. Your opinion and voice to your representatives matters most.
Thanks and enjoy the holidays.
Kelly Chezum, VP for External Relations firstname.lastname@example.org
Kerop Janoyan, Dean of the Graduate School email@example.com