Posted March 24, 2018 12:30:17The federal government is proposing to eliminate the tuition rebate that students pay on tuition and fees at public universities and colleges, but not at private colleges and universities.
Under the proposal, students who receive their undergraduate education from a public university or college would be able to deduct the full cost of their undergraduate tuition and fee payments.
Under the current program, students can deduct up to $1,200 of tuition and $1.75 of fees.
But students who attend private schools can deduct the cost of up to 80 percent of their tuition and a minimum of $300 per year.
The plan would eliminate the refundable portion of tuition.
The federal plan will affect more than 500,000 students, including 1.2 million from the poorest families in the country.
The Federal Trade Commission will also be investigating the impact of the tax plan on consumers.
The Tax Foundation, which advocates for lower taxes, has called the proposal “worse than a giveaway.”
“The Federal Reserve has not taken into account the impact on consumers,” said the foundation’s vice president, Robert J. Bartels.
“A student who pays full price for their tuition at public schools, or even pays less, but who still faces the cost to live on and attend a private school, will not be able deduct the entire cost of the school’s tuition and will instead be required to pay a portion of the cost out of pocket.”
The plan will not take into account any additional cost of attending a private college or university.
If you attend a public school, the student still pays the full price of the tuition and is subject to the federal deduction for any amount over the cap, and if you attend an independent school, you can deduct only the cost for room and board.
“The plan is a direct challenge to the Affordable Care Act, the signature policy achievement of President Donald Trump.
In an interview with NBC News last month, Trump said he was “not going to have to make cuts to our universities because we will have a rebate.”
The proposal is being promoted by Senator Ron Johnson, Republican of Wisconsin, and Representative Justin Amash, of Michigan.
A spokeswoman for the Republican National Committee said the campaign is “in support of the Trump Administration’s plan to make the $1 million deduction for tuition, fees and other out-of-pocket costs at public colleges and Universities available to every student.”
A statement from the Trump campaign did not immediately respond to requests for comment.
The U.S. House of Representatives approved a plan last month to cut $600 billion in federal spending from universities and their accrediting bodies.
The legislation, known as the Student Aid and Financial Aid Transparency Act, is now headed to the Senate, where it is likely to face a similar fate.