Thought I'd post this... Write your congressman if you agree this is a bad idea.
https://www.forbes.com/sites/starts...e&utm_content=link&ICID=ref_fark#6c10cd5d3d2f
https://www.forbes.com/sites/starts...e&utm_content=link&ICID=ref_fark#6c10cd5d3d2f
The gist of it is that under the new tax plan, tuition waivers for graduate school will be taxed as income. That might not sound like a big deal, but here is some background:
The vast majority of graduate students (STEM, in particular) in the US do not pay tuition. Instead, they teach for the university as a TA or perform research in a laboratory. The school grants them a tuition waiver and a small stipend in return. The stipend is usually around 20-25k/year, and the tuition waiver is valued at the cost of tuition, obviously. This can be upwards of 50k/year, even at a state school. When I was a grad student at UC San Diego, I believe mine was valued at around 40k or so, and my stipend was 22k/year. Currently, you do not pay taxes on the tuition waiver, only your actual income (ie, the 20-25k that you make). The proposal in congress would force you to pay taxes on your tuition waiver as well. This means that if I were still in grad school today and the law were to take effect, I would be earning about 22k/year, but paying taxes on around 60k. Effectively, I'd be paying around 7k in taxes on a 22k income, leaving me with almost nothing to survive on (around 15k).
To those who would suggest getting another job or some such, usually you have to sign a contract with the university that says you will not seek other employment. Not that you have time anyways, as it basically took 60 hours of work a week for four years for me to get my Ph.D. You don't have to sign that if you are paying out of pocket, of course, but that skirts the tuition waiver problem and relies on significant outside financial assistance. Loans are not the answer, because as someone who receives a tuition waiver and stipend, you do not qualify for any student loans (trust me, I tried to take out a small one to help me pay the rent). With your tuition beneift, you are technically making 60k/year and do not qualify for any other kind of assistance such as food stamps, etc.
In my case, rent for a crappy 700 sqft upstairs granny flat in a terrible neighborhood was well over 50% of my income. If you think I am exaggerating or that I could have trimmed back if I wanted, I will just say that in my 4 years in that neighborhood, I witnessed murders. I witnessed prostitution. I had several homeless guys sleeping on my block. One of them took his morning bowel movement on the walkway from my house to my car every single morning. I literally walked past (and sometimes through) piles of
every day to get to school. It was all worth it in the end, but taking away 1/3 of my meager income for taxes would have made it simply impossible without living on the streets.
So, as someone who has been in those trenches, and as someone who currently provides funding for graduate students at a major research university, I will tell you very plainly that this will kill graduate education in the US. Nobody will be able to afford to do it. I wouldn't have done it, and neither will anybody else unless they have significant outside financial support. If you want to ruin the academic system in this country, taxing the lifeblood (students) of the system into oblivion is the fastest way to do that.
If anyone here thinks this is a good idea, then I will simply ask one question: Logically, why don't we similarly tax undergraduate athletic scholarships? Make those students pay their fair share! After all, they receiving the same 'taxable' benefit I got, right?
In any case, I don't meant to say anything else about the tax bill, which is why I made this its own thread. In any tax overhaul, there will be winners and losers. There are obviously plenty of points to dispute in it, but I wanted to make a separate thread solely for this issue, which is the only complete deal-breaker in it that I've seen.
https://www.forbes.com/sites/starts...e&utm_content=link&ICID=ref_fark#6c10cd5d3d2f
https://www.forbes.com/sites/starts...e&utm_content=link&ICID=ref_fark#6c10cd5d3d2f
The gist of it is that under the new tax plan, tuition waivers for graduate school will be taxed as income. That might not sound like a big deal, but here is some background:
The vast majority of graduate students (STEM, in particular) in the US do not pay tuition. Instead, they teach for the university as a TA or perform research in a laboratory. The school grants them a tuition waiver and a small stipend in return. The stipend is usually around 20-25k/year, and the tuition waiver is valued at the cost of tuition, obviously. This can be upwards of 50k/year, even at a state school. When I was a grad student at UC San Diego, I believe mine was valued at around 40k or so, and my stipend was 22k/year. Currently, you do not pay taxes on the tuition waiver, only your actual income (ie, the 20-25k that you make). The proposal in congress would force you to pay taxes on your tuition waiver as well. This means that if I were still in grad school today and the law were to take effect, I would be earning about 22k/year, but paying taxes on around 60k. Effectively, I'd be paying around 7k in taxes on a 22k income, leaving me with almost nothing to survive on (around 15k).
To those who would suggest getting another job or some such, usually you have to sign a contract with the university that says you will not seek other employment. Not that you have time anyways, as it basically took 60 hours of work a week for four years for me to get my Ph.D. You don't have to sign that if you are paying out of pocket, of course, but that skirts the tuition waiver problem and relies on significant outside financial assistance. Loans are not the answer, because as someone who receives a tuition waiver and stipend, you do not qualify for any student loans (trust me, I tried to take out a small one to help me pay the rent). With your tuition beneift, you are technically making 60k/year and do not qualify for any other kind of assistance such as food stamps, etc.
In my case, rent for a crappy 700 sqft upstairs granny flat in a terrible neighborhood was well over 50% of my income. If you think I am exaggerating or that I could have trimmed back if I wanted, I will just say that in my 4 years in that neighborhood, I witnessed murders. I witnessed prostitution. I had several homeless guys sleeping on my block. One of them took his morning bowel movement on the walkway from my house to my car every single morning. I literally walked past (and sometimes through) piles of
every day to get to school. It was all worth it in the end, but taking away 1/3 of my meager income for taxes would have made it simply impossible without living on the streets.So, as someone who has been in those trenches, and as someone who currently provides funding for graduate students at a major research university, I will tell you very plainly that this will kill graduate education in the US. Nobody will be able to afford to do it. I wouldn't have done it, and neither will anybody else unless they have significant outside financial support. If you want to ruin the academic system in this country, taxing the lifeblood (students) of the system into oblivion is the fastest way to do that.
If anyone here thinks this is a good idea, then I will simply ask one question: Logically, why don't we similarly tax undergraduate athletic scholarships? Make those students pay their fair share! After all, they receiving the same 'taxable' benefit I got, right?
In any case, I don't meant to say anything else about the tax bill, which is why I made this its own thread. In any tax overhaul, there will be winners and losers. There are obviously plenty of points to dispute in it, but I wanted to make a separate thread solely for this issue, which is the only complete deal-breaker in it that I've seen.
