Proposed tax reform and its impact on graduate students

UTSA is a Hispanic Serving Institution, serving over 31,000 students, 4,220 of these are graduate students. The majority of our graduate students are pursuing advanced degrees in education, counseling, social work, and public policy. These programs are designed to prepare students to be leaders and active change agents within their communities.

UTSA has 618 graduate students working as research or teaching assistants. Preserving Qualified Tuition Reductions (sec. 117(d)(5)) would allow for these students to continue their studies.

Additionally, preserving section 117 (d)(5) is critical to UTSA’s research endeavors and to our production of a workforce pipeline—particularly in STEM areas—that employers need to propel our nation’s economy forward. UTSA’s cybersecurity graduate program was recently ranked #2 in the nation, by Universities.com. We have over 230 graduate students enrolled in cybersecurity and related fields, and one third of these are doctoral students. These students would be negatively impacted by any repeal of this critically important legislation.

Section 127 preserves employer-provided education assistance, allowing employers to offer employees up to $5,250 annually in tuition assistance which is excluded from taxable income. This provision continues to be an important means of building and adding to the competencies of the workforce and is crucial tool to helping our nation accelerate its economic growth.

Retaining the American Opportunity Tax Credit and the Lifetime Learning Credit is significant for UTSA, as many of our students are non-traditional students, part-time students, lifelong learners and graduate students.

While the Senate version preserves key programs for higher education it also contains a number of proposed changes that will negatively affect UTSA, some of which include:

Impact on Charitable Giving: This legislation would double the standard deduction for individuals and couples. This will reduce the number of taxpayers who itemize, reducing the value of the charitable deduction and leading to a drop in donations to universities like UTSA.

Deduction of College-Age Dependents: Under current law, taxpayers may claim a deduction ($4,050 in 2017) from income for each dependent. The House version eliminates all personal exemptions (in favor of higher standard deductions).

Unrelated Business Income Tax (UBIT): The Senate bill contains several proposals that would increase UBIT owed by many colleges and universities, including treating name and logo royalties as unrelated business taxable income and computing unrelated business taxable income separately for each trade or business in a so-called “basketing” fashion.

Thank you for allowing me to share my concerns. I welcome an opportunity to work with you to ensure that we do everything possible to help students graduate and succeed.