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Column
New Tax Breaks Will Help Ease The Burden Of College Expenses
by Assemblyman Willis H. Stephens, Jr. Column
Once again, tax season is upon us. As the April 15 filing deadline draws closer, most of us are scrambling to complete our federal and state tax forms. For many, myself included, this isn’t exactly our favorite thing to do. However, this year taxpayers have been provided a few new tax breaks, giving us something to look forward to in the current tax season. Since these breaks will affect a sizeable number of taxpayers in Putnam County, I thought it may be helpful to bring some of the details to everyone’s attention.
Starting this year, individuals can deduct the full amount of college tuition expenses paid, up to $10,000 per taxpayer. According to the 2000-2001 budget, this deduction will be allowed for independent taxpayers, spouses, or parents of children who attend a qualified college or other institution of higher education. The budget also states that instead of the itemized deduction, taxpayers who claim the standard deduction, or are not able to itemize their deductions, will have the option of receiving an annual tax credit of 4 percent of their payments for college tuition, up to a maximum of 5400 per year.
This deduction will be implemented in phases over a period of four years. Starting Jan. 1, 2001, both the deduction and credit will cover 25 percent of tuition payments made during the year. This is the amount that taxpayers can deduct this April. in each following year, the amount will increase by 25 percent until 2004. At that point, the increase will reach 100 percent of tuition payments and will continue at that level each subsequent year.
Taxpayers can deduct tuition payments made at community colleges, trade, technical, or other occupational schools, and all accredited two-year and four-year public or private colleges and other institutions of higher learning that have been approved either by the Regents of the University of the State of New York, or accredited by a nationally recognized accrediting agency. Tuition payments made for post-graduate education, or made following the receipt of any scholarships or financial aid, will not qualify for the credit.
College tuition costs continue to rise in New York state, and nationwide. This can be a heavy burden on those who shoulder this expense so they, or members of their family, can pursue higher education. Education is a top priority in New York state, as our future and the future of our nation depends upon it. A college degree provides an individual with the tools and knowledge necessary to meet today’s challenges and to succeed. It also helps to enrich their lives, and fosters an appreciation of history, science, literature and the arts. This tax break will help alleviate some of its expense, making a college education easier for individuals and families to afford.
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