The recent proposal by the president’s Advisory Panel on Tax Reform to tax, as income, the education benefits afford by colleges and universities has the potential to hurt those most struggling to pay for their children’s education, according to Ken Milani, professor of accountancy at the University of Notre Dame.
The burden, he says, would be particularly difficult for employees who work in private education, where tuition is regularly between $20,000 and $30,000.
As an example, Milani said an unmarried parent of two children with an income of $20,000 a year now pays about $450 a year in federal income tax. Were a $30,000 education benefit added as taxable income, that employee suddenly would appear to earn $50,000 a year and would owe the federal government about $5, 515. In Indiana, state taxes would increase by $1,050.
“That’s a $6,000 bite,” Milani says. “Where is someone who makes $20,000 a year going to get $6,000?”
Milani was honored in April by the Internal Revenue Service with a special service award for his work as program coordinator of the University’s Vivian Harrington Gray Tax Assistance Program (TAP). Through the program, he and Notre Dame accountancy students have provided free income tax preparation for low-income families for almost 35 years.
Contact: Ken Milani, 574-631-5296 or email@example.com. The preceding comments are for use in whole or part.
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