Published: Fri, December 01, 2017
Finance | By Kristine Clayton

Want to squelch research? Tax grad students' waivers

Want to squelch research? Tax grad students' waivers

Like other graduate students around the country, Wagh could lose money if Congress passes a Republican tax reform plan that would treat tuition waivers as taxable income.

"I want to see this tax plan go down", said Shannon Negaard, a University mathematics graduate student attending Wednesday's walkout.

A provision in the tax bill that the U.S. House of Representatives recently passed - and that the Senate is still considering - would impose a potentially enormous tax increase on graduate students: as much as a 300 percent tax hike in some cases.

Currently, the Senate bill does not have the provision to tax tuition waivers. The teaching assistants, research assistants and other graduate workers joined thousands of across the nation in rallying to oppose the Tax Cuts and Jobs Act, which they say could end up costing them more money.

They're anxious that adding more financial stress for future graduate students to navigate will make graduate school an unattainable career path for people from low-income backgrounds and families.

"The University runs and is affected by the presence of graduate workers, so to have people walk out and leave those spaces is an effective way to draw attention", Hilary Rasch GS told The Herald.

Addressing the crowd, global sociology graduate student Snigdha Kumar said worldwide students already face higher student fees, taxes and costs associated with moving to the United States.

Although mainly graduate students have been vocal against the bill, it still holds implications for undergraduate students, according to David Schwartz, an associate professor of psychology. However, students who are working toward an advanced degree are among those who could be paying more under the new plan.

"Based on the numbers I've seen in the physics department, we'd be making less than a minimum wage full-time job". The language in the House tax bill dictates that these tuition waivers would be taxable, counting the assistance as income. Despite University provisions that require student protests to be registered five weeks in advance, Rubenson said USC has supported their right to demonstrate. The students have claimed that no university representative has yet come for negotiations.

"It's a reality of life", she said.

UB issues tuition waivers to 1,472 students, according to UB spokesperson John Della Contrada.

Marshall said that a move to eliminate the deduction for state and local taxes could harm students if it means there's less state funding available for public universities.

Beyond shrinking diversity in schools, this tax reform may disrupt research being conducted around the world.

The Senate proposal would keep tuition waivers tax free, but the proposal to tax the waivers could reappear as Congress tries to reconcile plans from the two chambers. A major research university may invest $400,000 or more for each graduate student, through financial support including tuition scholarships and stipends.

As a fifth-year doctoral student in the Department of Earth and Planetary Sciences, Lin receives a stipend of about $30,000.

"There may be some legislators who are so committed to tax reform that perhaps they are less aware or less concerned about the impact on higher education", he said. To this end, I want to assure IU faculty, graduate students, staff, and other members of the IU community that our government relations team is working tirelessly here in IN and in Washington to help our representatives understand the implications of this legislation.

Earlier this month, the American Council on Education, on behalf of the Association of American Universities, of which IU is a member, and 45 other higher education associations, sent a letter to the leaders of the House Ways and Means Committee expressing strong opposition to several harmful provisions in the House legislation. The $1.41 trillion total student debt is out of control, with a loan default rate of 11 percent, and the majority of borrowers repaid nothing in the three years after finishing school.

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