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How College Students Will Be Affected by the New Tax Bill

The low-down on the new tax bill, from the student perspective.

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What does the new GOP tax bill mean for college students?

On December 22, Trump signed the new GOP the Tax Cuts and Jobs Act into law (which you can read in full here), maintaining his campaign promise to sign a major tax overhaul before Christmas. After passing two different versions of the bill in the House of Representatives and the Senate, the final bill went back to the House for a revote and then finally made its way onto the desk of the president. Many of the changes in the $1.5 trillion tax bill were enacted on New Year’s Day.

However, amidst protests and revisions that were literally scribbled in the margins, many Americans, particularly college students, have been left more than a little confused about what is going to change under the new bill—just ask Jenna Fischer, who posted a false tweet regarding tax deduction for teachers, prompting the actress to delete the tweet and issue a public apology.

Anyway, here’s the low-down on what you need to know about the new bill as you finish out your school year.

1. Student Loans

It’s important to note that although the Senate and House passed different versions of the tax bill in early December, the two groups then came together to create one bill. And, according to The Washington Post, provisions in the Senate’s version that made their way into the bill may actually benefit college students who have student loans—or at least not hurt them. While the House’s version of the bill repealed the ability of people to deduct their yearly student loan interest from their taxes, the Senate kept this provision in place, allowing taxpayers to deduct as much as $2,500 a year.

2. Graduate Student Waivers

Here’s another point where the House and Senate bills disagreed: graduate student tuition waivers. The House bill included a provision saying that graduate students who receive tuition waivers—in other words, free tuition in the form of student teaching or research—should be taxed on the money put forth for tuition as if it were income (a move which caused protest amongst those in higher education). The Senate bill rejected this change, which could discourage people from pursuing graduate studies.

3. Higher Education Tax Credits

The final bill also rejects the House’s proposal to combine three higher education tax credits—i.e., a specific amount of money that people paying for higher education are allowed to subtract from their taxes—into one tax benefit.

4. Ivy League Endowments

Colleges with an endowment of over $500,000 per student have a new tax of 1.4 percent. Not many schools have such a large endowment—ahem, Ivy Leagues—but the ones that do will definitely be cutting a big check to the IRS.

5. Employer Tuition

This provision would typically apply to a nontraditional student pursuing an undergraduate or graduate degree while also maintaining a full-time job. Often employers will pay for higher education and continuing education programs that will benefit the organization or company in some way. Under the House bill this tuition money would have been taxed; however, under the Senate and final bill, employers can contribute up to $5,250 a year for qualifying programs and that money will remain untaxed.

6. The AOC and LLC

The American Opportunity Credit (AOC) and Lifetime Learning Credit (LLC) are tax credits for students paying tuition. The AOC is for undergraduates and is worth up to $2,000 per year per student, while the LLC is for graduate students and is worth up to $2,500 per year per household. Although the tax credits came under discussion in the Senate and House bills, both the AOC and LLC made their way into the final version of the bill.

Want to learn more about the new tax bill? Check out this New York Times article on how the tax bill will affect you.

Grace Cooper is a senior Nonfiction Writing and Psychology student at the University of Pittsburgh. Follow her on Twitter and Instagram at @gracie_coo.

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Business

Trump Has a Really Big Budget Proposal

And it might hit higher education right where it hurts.

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The president is feeling confident about his 2019 budget (Image: Wikimedia Commons)

The White House’s 2019 budget proposal was released yesterday, with the bold headline being that the administration wants $4.4 trillion for the year. The proposal bears President Trump’s vision of an America armed for war, paid for in part by an America that doesn’t prioritize education.

The $4.4 trillion is a dramatic increase from the amount of money the Trump administration spent during 2017. Much of the added funds would go toward military spending and toward funding a wall on the border between the United States and Mexico.

“We’re going to have the strongest military we’ve ever had, by far,” the president said. To “balance” the federal budget see-saw, Trump removes weight through cuts, scientific research, public broadcasting, and domestic programs benefitting the poor and middle class, such as student loans.

The proposal would also reduce funding for social programs like Medicaid and Medicare. Even with these cuts, government spending is projected to increase the federal debt by at least $7 trillion by 2027.

According to CNBC, “The proposal would sharply curtail income-based repayment plans, scratch the Public Service Loan Forgiveness Program, and embolden the government to go after students who don’t pay their loans and cut funding for federal work study in half.”

Implementation of such changes to loans would be seen by borrowers only after July 1, 2019. 

As lawmakers from both parties digest the details, they will be arming for a potentially long struggle toward approval in the weeks ahead.

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Business

Dunkin’ to Stop Using Foam Cups by 2020

And it’s about time, too.

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There has always been something different about getting coffee from Dunkin’ Donuts. It’s a no-frill — but super tasty — alternative to Starbucks or your local brewer, with down home, no-frills feel.

And they serve their brew in those foam cups. Comforting and easy to grab, sure, but not very good for the environment.

Dunkin’ announced today that those polystyrene foam cups will be completely phased out from its stores globally by 2020, reducing the waste stream by millions.

Foam packaging of any kind decomposes very slowly, washes into waterways and can harm sea life and other creatures who depend on the water supply to live.

McDonald’s also said it will get rid of any remaining foam cups in the next few years as well, though they have already drastically reduced dependance on them.

So raise one to Dunkin’ for taking a step in an environmentally friendly direction.

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Business

Buzzfeed and NBC Launched a ‘Millennial Parenting’ Channel Today

Playfull is aimed at parents aged 20-34, which is you, college students with kids.

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NBCUniversal and BuzzFeed launched something that is being called a “millennial parenting channel” today on Facebook.

Peggy Wang, BuzzFeed’s editorial director for lifestyle brands told Digiday that the focus will be giving parents valuable and relatable information with a BuzzFeed bent. Those parents are in the age range of 20 to 34, meaning it would include some college students.

Expect to see a 15-second commercial that will air during the Winter Olympics pushing the Playfull brand.

The idea behind Playfull is to replicate the success of other lifestyle platforms like Tasty and Nifty. Together, those two channels have over 100 million followers on Facebook.

Here’s the video that appeared on Playfull’s page this morning:

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