The House's Tax Bill Levies a Tax On Graduate Student Tuition Waivers (nytimes.com)

Camel Pilot writes: The new GOP tax plan -- which just passed the House -- will tax tuition waivers as income. Graduate students working as research assistants on meager stipends would have to declare tuition waivers as income on the order of $80,000 income. This will force many graduate students of modest means to quit their career paths and walk away from their research. These are the next generation of scientists, engineers, inventors, educators, medical miracle workers and market makers. As Prof Claus Wilke points out: "This would be a disaster for U.S. STEM Ph.D. education." Slashdot reader Camel Pilot references a report via The New York Times, where Erin Rousseau explains how the House of Representatives' recently passed tax bill affects graduate research in the United States. Rousseau is a graduate student at M.I.T. who studies the neurological basis of mental health disorders. "My peers and I work between 40 and 80 hours a week as classroom teachers and laboratory researchers, and in return, our universities provide us with a tuition waiver for school. For M.I.T. students, this waiver keeps us from having to pay a tuition bill of about $50,000 every year -- a staggering amount, but one that is similar to the fees at many other colleges and universities," he writes. "No money from the tuition waivers actually ends up in our pockets, so under Section 117(d)(5), it isn't counted as taxable income." Rousseau continues by saying his tuition waivers will be taxed under the House's tax bill. "This means that M.I.T. graduate students would be responsible for paying taxes on an $80,000 annual salary, when we actually earn $33,000 a year. That's an increase of our tax burden by at least $10,000 annually."

Comments

So, like every other write-off then

[Orgasmatron]

Just FYI, any time you are given something of value, it is income. Someone lets you live in their house for free? Income. Someone writes off a debt instead of collecting it? Income. Someone waives a fee they normally charge? Income. A friend gives you an interest-free loan, or even just at below-market interest rates? The IRS has tables to calculate how much income you are required to report. I'm kinda astonished that these tuition waivers weren't always taxed, since everything else is.

There is an exemption for gifts, up to $13,000 per person per person per year. (not a typo) They must be bona fide gifts with no strings or conditions.

Re:Lets be honest

[JoshuaZ]

Let's see. Increase tax burden massively for grad students. So what else do we have? Well, we've got a tax break for private jet owners added in http://thehill.com/blogs/blog-briefing-room/360785-senate-tax-bill-includes-tax-break-for-private-jets (Note that The Hill is a general news site related to Washington politics, generally pretty non-partisan). We've got a removal of the tax deduction for state and local taxes https://www.reuters.com/article/us-usa-tax-local/u-s-towns-cities-fear-taxpayer-revolt-if-republicans-kill-deduction-idUSKBN1DH01D, which is both of quesitonable constitutionality due to the double taxation, screwing over specifically the people in "blue" states which generally have higher state taxes, and harming disproportionately people in middle income brackets. So, yes, please tell Snotnose above or me what sources we should be looking at to see what is wrong about their description. What information that we are not seeing in our echo chamber should change our viewpoint?

Just Come to Canada

[Roger W Moore]

Here tuition is tax deductible, scholarships and grants are tax exempt and most if not all of your TA pay counts as a scholarship.