ACE on Tax Policy
A number of higher education tax incentives have been instituted over the years to help students and families offset the cost of a college education. Congress recently extended a handful of these incentives in the American Taxpayer Relief Act of 2012, including the American Opportunity Tax Credit, the above-the-line deduction for qualified tuition and related expenses, the IRA Charitable Rollover, and the research and development tax credit.
The same legislation made permanent Sec. 127 employer-provided education expenses, the Student Loan Interest Deduction, and Coverdell Education Savings Accounts, which previously were temporary parts of the tax code that needed to be renewed periodically.
There also is a movement in Congress supported by ACE to reform current tax incentives to create a simpler, consolidated higher education tax credit that would be a stronger, more effective tool for increasing access to college.