House to Vote on New Education Bill

The U.S. House of Representatives is expected to schedule a vote, perhaps as early as this week, on H.R. 5193, tentatively called the Back to School Tax Relief Act of 2002. The bill, introduced by Rep. Bob Schaffer (R-CO) and supported by many Republicans in the House, provides tax deductions for elementary school education costs for students in grades K-12 who attend public, private, religious, and home schools.

Under the terms of the bill, above-the-line deductions up to $3,000 for tuition, tutoring, supplies, transportation, computers, and other school-related expenses will be available to single parents with incomes of $20,000 or less or married couples with incomes of $40,000 or less.

Should the bill become law, the deductions will be available for tax years beginning after December 31, 2002, and will continue for three years, after which the bill will expire and deductions will no longer be available.

House Democrats oppose the bill on the grounds that it will only add to federal deficits and will have the added effect of shifting money from public to private schools. Opponents also note that many families in the income range supported by the bill would not qualify for the deduction due to the fact that they aren't paying any substantial amount of income tax anyway. Another complaint is that the bill lends itself to abuse among tax dodgers who might attempt to exploit the tax break by taking deductions for items such as taxi rides to school and overly-expensive sneakers for gym class.


Already a member? log in here.

Editor's Choice

Upcoming CPE Webinars

Dec 3The materials discuss the concepts and principles in the AICPA’s new special purpose framework.
Dec 8Kristen Rampe will cover how to diffuse the tension in challenging situations in this one-hour webinar.
Dec 9A key component to improving your firm’s workflow efficiency while enhancing your profitability at the same time is how you leverage emerging technologies.
Dec 16Kristen Rampe will give tips on how to bring confidence into the room and build a valuable network.