Durbin Says GOP Fails American Families by Eliminating College Tuition Tax Deduction in Favor of $5 Billion in Giveaways to Big Oil

DURBIN SAYS GOP FAILS AMERICAN FAMILIES BY ELIMINATING COLLEGE TUITION TAX DEDUCTION IN FAVOR OF $5 BILLION IN GIVEAWAYS TO BIG OIL

U.S. Senator Dick Durbin (D-IL) today joined Senator Chuck Schumer (D-IL) in calling on the Republican leadership to restore the College Tuition Tax Deduction that was originally included in the Tax Reconciliation Bill but was cut in order to restore tax breaks for Big Oil.

"The Republican leadership deserves a failing grade from families all across America; they're giving more money to Big Oil and taking it away from families struggling to pay for college," Durbin said.

Durbin said the provision, which allows families to deduct a large percentage of college tuition costs from their taxes, was partially paid for by eliminating almost $5 billion in tax breaks that favor Big Oil. In 2004, 6.4 million American families took advantage of the deduction, saving them about $4.5 billion. Durbin noted that oil companies have made record profits last year, toping more than $100 billion. He said that after covering all their costs last year, Big Oil took profits from consumers that amounted to $908 from every household in America.

"Congress and the President continue to insist that the oil industry is more deserving of help than families in Illinois and across the country trying to put their kids through college. It is time for Congress to put an end to the special interests giveaway to Big Oil and to begin investing in the education of students all across America."

The accounting provision, called "Last in, First out" (or LIFO), allows the oil company to make its taxable income appear lower than it really is. This will save oil companies about $4.3 billion over two years.

The 2001 tax bill contained a provision that made college tuition tax deductible for the first time ever. The deduction makes $3,000 in college tuition costs tax deductible by 2002 and $4,000 tax deductible by 2004. Specifically, the college tuition tax deduction allowed single filers with taxable income of up to $65,000 and joint filers with income of up to $130,000 to deduct $3,000 in tuition costs from their taxable income in 2002 and 2003; Single filers and joint filers were able to deduct $4,000 in tuition costs from their taxable income in 2004 and 2005; Single filers earning between $65,000 and $80,000 and joint filers earning between $130,000 and $160,000 were able to deduct $2,000 in tuition costs, in 2004 and 2005.

http://durbin.senate.gov/record.cfm?id=255193&&