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ACE, Higher Education Associations Urge Lawmakers to Support Higher Education Tax Provisions, Safeguard the Charitable Giving Deduction

April 17, 2013

 

​On behalf of a number of higher education associations, ACE President Molly Corbett Broad this week submitted comments to a pair of House Ways and Means Committee Tax Reform Working Groups, one on education and family benefits and the other on charitable/exempt organizations.

The comments come on the heels of an appearance last week by ACE Senior Vice President Terry Hartle before the committee’s education and family benefits working group, where he expressed the higher education community’s support for the current “three-legged stool” framework that encourages saving for higher education, helps students and families pay for college and assists borrowers as they repay student loans.

Among the tax provisions Hartle and the ACE comments discussed are the American Opportunity Tax Credit, the Lifetime Learning Credit and the above-the-line deduction for qualified tuition and related expenses.

In addition, the comments express support for expanding the Student Loan Interest Deduction, an above-the-line deduction which permits taxpayers with less than $75,000 of income ($155,000 for joint filers) to deduct up to $2,500 in federal student loan interest payments each year. The current $2,500 limit has been in place since 1997 and should be expanded to allow a greater amount of interest to be deductible. 

In the comments to the working group examining charitable/exempt organizations, ACE stressed the importance of the itemized deduction for charitable giving. The comments indicate that while the higher education community recognizes the need for major, long-term deficit-reduction and the shared sacrifice necessary to accomplish this goal, lawmakers should proceed very cautiously when considering any potential changes to the current charitable deduction.

ACE and a coalition of higher education associations last year sent letters to the president and Congress sounding a similar warning about changes to the charitable giving tax deduction as part of any fiscal deal. (Click here for more information and talking points about the importance of this deduction to higher education.)

Another tax provision, the IRA Charitable Rollover, is set to expire on Dec. 31, 2013, after being renewed as part of the American Taxpayer Relief Act of 2012, the ACE comments noted.

The IRA Charitable Rollover permits individuals age 70 and a half and older to donate up to $100,000 from their Individual Retirement Accounts (IRAs) and Roth IRAs to public charities, including colleges and universities, without having to count the distributions as taxable income.  

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