Tax Changes Could 'Devastate' Graduate Students and American Competitiveness


Rhoads is pursuing a doctorate in neuroscience at Georgetown University.

The more expensive the university tuition is, "the more valuable these waivers are and therefore the higher amount of tax you would be liable for", he said. With the new tax plan, the stipend and their tuition would be considered taxable income, which puts them in a higher tax bracket, forcing them to pay more in taxes.

"It's a disaster", she said.

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Graduate students at Fresno State are not offered stipends like those given at other universities.

Currently, only the stipend is taxed. At Northeastern University, 1,200 of the 1,300 doctoral students receive the tuition benefit.

The rally was a mixture of members of Loyola's non-tenured faculty union and graduate student union and individuals from the Loyola Worker Coalition, which joins undergraduate students and tenured faculty.

But the House tax bill approved in November would make the amount of the tuition waiver taxable.

Under the plan, those discounts would be considered income for tax purposes, even though students never see that money in their bank accounts.

In addition to the provision in the House version of the tax bill that would tax graduate student tuition waivers, other provisions in the House bill would tax employer-provided education assistance and end the tax deduction for interest paid on federal student loans. The House and Senate will now negotiate the final legislation.

It stated that since graduate students already pay high interest rates on their loans, a tax bill that targets education by removing the ability of the graduate students to deduct the loan interest payments "only increases their debt".

"We would basically be priced out of being able to afford higher education", said Steven Manicastri, a Ph.D. student and teaching assistant at the University of CT.

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Humbert, who works a part-time job and teaches three classes as an instructor of record, said she and her fellow graduate students fear this tax bill will discourage future students from enrolling because they won't be able to pay for it.

"Is that fair?" said Brady, a Republican from Texas. Even if the GOP hands President Trump a bill that excludes many higher education provisions, the impact that tax reforms could have on working families is of great concern, Groebe said.

According to the Association of American Medical Colleges, 75 percent of the medical school class of 2017 graduated with student loan debt, with almost half owing $200,000 or more. The proposed provision would dramatically increase what students owe in taxes each year.

Meanwhile, universities and students are trying their best to sway lawmakers.

Students can sign petitions or call their representatives to protest the proposals from the proposed House bill. They have submitted editorials to their hometown papers opposing the bill.

Kim Rueben, a tax policy expert with Urban Institute, a left-leaning think tank, said that while a tax reform could indeed boost the economy, this bill would do the opposite.

Graduate students say their taxes will skyrocket if a proposal to treat their tuition benefits as income makes it into the final version of the legislation.

"The [tax plan] would essentially make going to graduate school prohibitive for the people who can't readily afford it", Duncan said.

Indiana University President Michael McRobbie said eliminating the tax waiver would disproportionately harm students in STEM fields at the nation's research universities. "Now if you recruit someone one with a full-tuition scholarship, it will be taxed", he said. "For instance, a new, potentially promising approach to treating cancers and genetic diseases was pioneered by students during their graduate training at Harvard and Berkeley". "I hope the universities would be more clear with students about what they will do". The detrimental effects of the tax plan should not go unheard.

If universities reduced tuitions, it could also ultimately mean less in matching federal funds, Thomas said.

Graduate students have staged walk-outs and teach-ins at schools around the country, including the University of Southern California, Harvard, the University of Minnesota, Ohio State and the University of Kansas.