AmeriCorps volunteers would receive a tax break for higher education costs under a bipartisan, bicameral bill introduced on Dec. 13 by U.S. Sen. Bill Cassidy (R-LA) and U.S. Rep. Don Bacon (R-NE).
“AmeriCorps members dedicate their time to national service for the betterment of their communities,” Sen. Cassidy said. “The least we can do to honor their service is not stick them with taxes that other Americans don’t pay.”
The Segal AmeriCorps Education Award Tax Relief Act of 2023, S. 3487/H.R. 6759, would amend the Internal Revenue Code of 1986 to provide an exclusion from gross income for AmeriCorps educational awards, according to the text of the bill.
Currently, Segal Education Awards are considered taxable income, but the proposed bill would exclude these awards from income tax to reflect the intent of federal education awards, help those serving pay for college, and remove a barrier that may discourage young people from taking advantage of the financial assistance they’ve earned, says a bill summary provided by the lawmakers.
“These dedicated Americans shouldn’t have to pay taxes on a benefit they receive while in turn, providing valuable services for our country,” said Rep. Bacon. “We don’t make Pell Grant recipients pay taxes on their grants and neither should these individuals.”
Sen. Cassidy is the lead original cosponsor of S. 3487, which is sponsored by U.S. Sen. Michael Bennet (D-CO) and four other fellow cosponsors, including U.S. Sens. Susan Collins (R-ME) and Roger Wicker (R-MS).
Rep. Bacon is also the lead original cosponsor of the U.S. House version, H.R. 6759, which is sponsored by U.S. Rep. John Larson (D-CT).
The bill is supported by 100 organizations, including Voices for National Service, Habitat for Humanity, the National Alliance for Public Charter Schools, the National Council of Nonprofits, Teach for America, and the YMCA of USA, and many others.