Senate Passes Renewal Of Schumer's College Tuition Tax Deduction That Saves Middle Class Families Across 5 Boroughs Thousands Of Dollars Every School

Senate Passes Renewal Of Schumer's College Tuition Tax Deduction That Saves Middle Class Families Across 5 Boroughs Thousands Of Dollars Every School Year

With the cost of college tuition skyrocketing across New York's five boroughs, today, U.S. Senator Charles E. Schumer announced that a two-year extension of the Schumer-authored "College Tuition Tax Deduction" was approved by the Senate early Saturday morning. Schumer said this tax deduction is needed now more than ever as college tuition costs have skyrocketed across New York City. The college tuition tax deduction, which expired at the beginning of this year, saves middle class families across the country and here in New York City thousands of dollars every year by allowing them to deduct up to $4,000 in college tuition expenses from their taxes. In October, Schumer personally lobbied outgoing- Majority Leader Senator Bill Frist to bring legislation to extend the tax deduction to the Senate floor during the current lame duck session.

"A college education is a necessity that's become priced as a luxury - and it's breaking the bank for students and their families across our city's five boroughs," said Senator Schumer. "From Kew Gardens to Carroll Gardens, from Riverside to Riverdale, hard-working New York parents are saddled with mounting debts and second mortgages just to meet spiraling tuition costs. That translates into lost family vacations to Jones Beach, passing up Mets and Yankees games, and the much more difficult decisions on how many children can attend school. The college tuition tax deduction makes these choices a little easier by saving families thousands of dollars every year."

The college tuition tax deduction, passed into law in 2001 and based on bi-partisan legislation written by Schumer, originally allowed middle-income families to deduct $3,000 from their tax return. The tax deduction was raised to $4,000 a year in 2004. Last year, single filers who made up to $65,000 a year and married couples with incomes up to $130,000 qualified for the tuition deduction. There was also a smaller, $2,000 tax deduction for those who earned more. According to the Internal Revenue Service, in 2003, 3.6 million families took advantage of the tax deduction, saving them about $4.5 billion

However, in May, language extending the tax deduction for another three years was eliminated from the tax reconciliation bill in favor of restoring $5 billion worth of tax breaks of the major oil companies. In legislation passed early Saturday morning, Congress renewed the lapsed tax deduction for 2006 and extended it through the end of 2007. So come tax time in April, families can rest assured that they will be able to take a deduction on this year's tuition expenses.

In New York, 238,000 families took advantage of the college tuition tax deduction in 2003. According to the National Center for Education Statistics, between the 2000-2001 school year and the 2004-2005 school year, the average price of going to a 4-year public college including tuition, fees, and room and board in NY increased by 21%, rising from $10,254 in 2001 to $12,441 in 2005. The average price of a 4-year private college including tuition, fees, and room and board in NY increased by 23%, rising from $25,171 in 2001 to $30,907 in 2005.

This past October, Senator Schumer released a new report showing that, since the 2000-2001 school year, the price of going to college in New York City has risen 31%. Below are statistics for the increase in college tuition in New York City from the 2000-2001 school year to the 2005-2006 school year.

• In New York City, 95,013 families took advantage of the college tuition tax deduction in 2003. Over the past five years, the average price of going to college in New York City is up 31 percent, rising from $9,632 in 2001 to $12,731 in 2006.

• In the Bronx, 16,798 families took advantage of the college tuition tax deduction in 2003. Over the past five years, the average price of going to college in the Bronx is up 38 percent, rising from $10,184 in 2001 to $14,075 in 2006. • In Brooklyn, 30,764 families took advantage of the college tuition tax deduction in 2003. Over the past five years, the average price of going to college in Brooklyn is up 36 percent, rising from $11,433 in 2001 to $15,568 in 2006.

• In Manhattan, 19,714 families took advantage of the college tuition tax deduction in 2003. Over the past five years, the average price of going to college in Manhattan is up 26 percent, rising from $10,695 in 2001 to $13,480 in 2006.

• In Queens, 27,737 families took advantage of the college tuition tax deduction in 2003. Over the past five years, the average price of going to college in Queens is up 25 percent, rising from $6,218 in 2001 to $7,802 in 2006.

Schumer is also the author of the bi-partisan "Make College Affordable Act" (S. 759) which would increase the maximum amount of tuition costs that can be deducted to $12,000 each year. In addition, the bill would help college graduates pay off their loans by offering a tax credit of up to $1,500 for interest paid on student loans over the first five years of repayment. The full credit would apply to single filers with incomes up to $50,000 and joint filers with incomes up to $100,000. The legislation would still allow parents to choose Hope Scholarships instead of the tax deduction, based on which works best for them.

http://schumer.senate.gov/SchumerWebsite/pressroom/record.cfm?id=266858&&year=2006&