Senator Charles Schumer announced at a press conference held at UR on Thursday, Feb. 19, that middle-class families will be able to receive a $2,500 tax credit for each student in higher education. The provision was part of the $787 billion stimulus package passed last week by President Barack Obama.
‘A college education is a necessity that is being priced as a luxury,” Schumer said. ‘This bill is a new approach that would mean for every $1 spent on college tuition, middle-class families can get $1 off their taxes.”
UR President Joel Seligman introduced Schumer to the audience in the Welles-Brown Room of Rush Rhees Library.
Schumer explained that originally the tax-credit plan was not included in the stimulus package, but he worked with leaders in both the Democratic and Republican parties to include the provision.
The tax credit will go into place for the 2009 tax year and will replace the current Hope tax credit. The Hope tax credit only applied to families making less than $60,000.
A family making $60,000 would receive $1,800 off its taxes under the current law, but with the new tax credit, families will receive $2,500 off their taxes.
Any family making under $180,000 can take $2,500 off its tax payments for each child in higher education, meaning community, public and private colleges, as well as graduate school.
‘In tough economic times like these, this bill will offer families real relief,” Schumer said.
Individuals in higher education and paying for it on their own, as well as single parents making less than $90,000 can also take $2,500 off their taxes.
The credit is also 40 percent refundable, meaning that if a family or individual does make enough money to pay taxes, they can still receive 40 percent of the benefit.
Schumer began the press conference by explaining the three main goals of the overall stimulus package and how the education provision would bring the stimulus package closer to those goals.
‘The goal of the stimulus package is, first, to create and keep jobs, second, to put money in the pockets of the middle class so that they can invest it in the economy, and third, to improve the long-term infrastructure of the country,” Schumer said.
Emphasizing the value of education, Schumer highlighted that it was important to focus on future generations during tough economic times.
‘One of the important resources in this country is the young people and their education is crucial to the long-term success of the country,” he said. ‘Every time a student drops out of college or decides not to attend it is a loss for the entire country.”
Schumer cited the rising cost of higher education as a problem that many middle-class families are struggling with.
Last year alone, the cost of attending a private four-year institution rose 6.3 percent, and the cost of attending a four-year public school rose 6.6 percent.
According to the Federal Advisory Committee on Student Financial Assistance, cost factors prevent 48 percent of college-qualified high school graduates from attending a four-year institution and 22 percent from attending any college at all.
Schumer noted that the cost of the program is significant and is projected to cost $12 billion.
Local education leaders were also in attendance. Nazareth College President Dave Bravemen and St. John Fisher College President Donald Bain made brief remarks thanking Schumer for helping to get the provision into the stimulus package.
Brunell is a member of the class of 2012.