The House of Representatives approved a bill on Thursday that was introduced by Rep. Diane Black (R-Tenn.) to help families plan for and invest in post-secondary education by simplifying the tax code.
The Student and Family Tax Simplification Act would consolidate four previous education provisions into a single measure that would provide a maximum tax credit of $2,500 per year to cover tuition, fees and course materials, according to a press release.
“It’s a well-known fact that the cost of education is climbing, and that for too many the ability to save and pay for college without ending up under a mountain of debt is simply out of reach,” Black, a member of the House Ways and Means Committee, said. “Today’s broken tax code does little to ease that financial burden or provide a sense of security that education will be a reality in the future. Streamlining the number of education provisions and retooling those that are most effective allows us to simplify the code and reduce some of the confusion that exists today.”
Under the legislation, the tax credit would be available for up to four years for students who attend qualifying universities, community colleges or trade schools. The credit would begin to phase out for families with incomes between $160,000 and $180,000, or for individuals who earn half that amount.
“I think we can all agree that it ought to be easier for any family to plan, save and invest in education,” Black said. “I applaud my colleagues in the House for their work today, and I urge the Senate to follow our lead by taking up this important legislation to make higher education more affordable for American students and families.”
Black served as the chairwoman of the House Ways and Means Committee’s Education Tax Reform Working Group last year, which was established by Rep. Dave Camp (R-Mich.), the chairman of the committee, to make the tax code flatter, fairer and simpler.