Who Gets What: Billions to colleges and students

Parents Forum
81

<p>youre right. maybe i'm an idealist. maybe they did party hard and this and that. doesn't mean their kids don't deserve some money to go to community college for 2500 a year or wherever, so they don't turn out like their parents.</p>

<p>and yeah, maybe the other family just got a job making 160k. that means they can put some of that new money into tuition... nobody is forcing the 5 kids to go to colleges that cost 50k per year.. they can go to community college just like the above mentioned kids for 2500 and it wont be much of a strain out of that 160k...or in the very least, they don't need as much help as the above mentioned children. </p>

<p>Lets penalize all the kids because of their parents actions.</p>

<p>the credit doesn't bother me either way. i can apply it to my own personal situation. i'm 26 years old. i already financed my education. i have a job. i own my car. i own my own house. pretty much nothing in that stimulus package is going to benefit me personally.... i'll take my 400 dollars and smile, even though it's my tax dollars going towards all of these other programs and credits.. but that doesn't mean that i don't support it. it's not there to help everybody... but it will help some. if you extend that particular credit, or any other for that matter, to cover every single american equally across the board, we'll be putting even more (unnecessary) debt onto the future generations. 2500 to a kid whose parents make 20k a year is going to have much more of an effect on their education then 2500 to kids whose parents make 160k. it's common sense, to me anyway. but what do i know, i'm just a dumb ignorant blonde who didn't particularly care for economics. ;)</p>

82

<p>
[quote]
A tax credit is money that comes back to you irregardless of income earned or tax paid. It is common for someone who is low income to have a negative tax rate due to a tax credit.

[/quote]
This is not correct for all tax credits. They can be refundable (you get money in excess of your tax liability) or not refundable (they just reduce your tax liability - you do not get a 'refund' of any excess). For instance the current education tax credits (the Hope and the lifetime learning) are not 'refundable credits' which means that they reduce your tax bill but you do not get a refund of any excess. The maximum Hope credit for 2008 is $1800. If you have in excess of $1800 in taxes you may get the full $1800 wiped out (if otherwise eligible). But if you have $600 in taxes then you save the $600 in taxes - you do not get another $1200 paid to you.</p>

<p>The new (or expanded) education credit is part refundable and part not. The total possible credit is $2,500 (based on 100% if the 1st $2000 of tuition and 25% of the next $2,000). Up to 40% of it is refundable, so up to a maximum of $1,000 may be paid to someone with no tax liability.</p>

<p>The new credit (the American Opportunity tax credit is it's name in the bill) is not a completely new thing but is an expanded version of the Hope credit. $2500 instead of the current $1800. Available for 4 years of school rather than 2 years. Partly refundable ($1,000). I *think *the lifetime learning credit (which is not refundable) is still available for those who do not qualify for this.</p>

83

<p>Just a note: the Hope and Lifetime Credits are per child according to a document that I read and it appears to also be the case for the tax software that I'm using. From what I can tell, the new credit is just an expansion of the Hope Credit by $500 - and it bumps up the income limits.</p>

<p>If you're not going to community college, it appears to me that this credit will just be swallowed up by tuition increases.</p>

84

<p>What really annoys me, again, is that none of this considers COLA. No one in Congress has any problem imposing high taxes on the people on the coasts with higher income, but even my friend, the single mom teacher (husband died when child was young, not much insurance), wont qualify for this latest help. She is working an extra job now.</p>

85

<p>
[quote]
If the "other related expenses" include room & board,

[/quote]

It doesn't. It includes required books and supplies which preivously it did not.</p>

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<p>Actually this little gem is apparently included along with the economic stimulus funding. </p>

<p>Back</a> Room Deal on Student Loan Subsidies? | New America Blogs</p>

<p>Quite a substantial increase, and because its still in place and subject to little debate-it may be one of the causes for the nominal increases in such as Pells and other direct student support via the stimulus bill. </p>

<p>And the slight increase in Pells won't be enough to cover for the usual 6%+ yearly increase in tuition. Tax credits as noted would be of little value to many as their economic status precludes benefiting from it. Essentially for much of the population at the CC's any tax reduction will go immediately for such as car repairs or to avoid evictions. So whatever results from a small educational tax breaks is not going to be applied for education. For this class the economies so bad that patches for immediate problems now have to take precedence. As is very evident from the situation at the CC in my community-when the Pell checks were distributed a sizable contingent of those students were over at the WalMart buying basic commodities (rice & ramen noodles). Books and supplies are a non-issue if someone hasn't been able to eat properly or at all. And supplementary jobs (if one can get one or keep it with all the layoffs) no longer pay enough to be relevant, most of these students do have them but are still needing to use the Pell money for otherwise than educational uses. </p>

<p>Our governments incredibly inconsistent on education and social issues, some monies are being freed up for student support but not nearly enough. But it appears there are other facets of the government who have reason to be very concerned about our educational situation and possible social repercussions.
And it'll take a bit more than a slight increase in Pell grants and some tax write offs to mitigate these potentially troublesome developments...which are bound to manifest in a much more direct manner as the economy continues to worsen. </p>

<p>Courtesy of the CIA 2009 World Factbook-
"The onrush of technology largely explains the gradual development of a "two-tier labor market" in which those at the bottom lack the education and the professional/technical skills of those at the top and, more and more, fail to get comparable pay raises, health insurance coverage, and other benefits. Since 1975, practically all the gains in household income have gone to the top 20% of households."
"Long-term problems include inadequate investment in economic infrastructure, rapidly rising medical and pension costs of an aging population, sizable trade and budget deficits, and stagnation of family income in the lower economic groups"</p>

87

<p>
[quote]
Dear fendergirl: Spare me the phoney, self-serving moralizing unless youre willing to apply it accross the board and to your own situation whatever that maybe.</p>

<p>Applying your standards evenly, a family which only earns $15,000 a year obviously hasnt been spending their lives very productively have they? Theyre irresponsible "losers" and we shouldnt be bailing them out for their bad decisions, either. Maybe they partied and did drugs when they were young instead of pursuing a good job or education. Maybe they had opportunities but passed on them for lifestyle reasons, they wanted to be poets, artists, or to live on a commune. Or maybe they are members of the permanent underclass who work minimum wage just long enough to qualify for unemployment benefits and then go on back to work when it expires and then start all over again, because they dont want to work. Or maybe they are tax cheats or drug dealers who have alot of money but dont declare any of it. Why should others be paying for these folks and not others?</p>

<p>Or maybe, just maybe, this family, which is now making $160k, just landed that job this year and has no savings. Or maybe, in the past, they had huge medical or other expenses and losses. Maybe they have 5 kids in school. What if they assiduously saved for their kids and lost it in the recent stock market and real estate collapse, which was the point of the OP?</p>

<p>These are the types of issues that are always involved, and never satisfactorily addressed, when the government confers this type of benefit on some but not all citizens. Neither it nor you is competent at it.</p>

<p>Dont be self righteous and ignorant. It's a hell of a combination.

[/quote]
^^^mia</p>

<p>Wow.</p>

<p>This may be the most insensitive post I have ever read. This is an attack post, plain and simple and I commend fendergirl for not rising to your bait. There was nothing fendergirl said that warranted it, and I believe says much more about you, mia. None of it good.</p>

<p>Also, what makes you think poets and artists don't make any money? The entire entertainment industry is packed with them. Leaving out entertainment, medical illustrators, biomedical photographers, cell phone designers, toy designers, jewelry designers, etc (I could go on all day), are all artists. </p>

<p>I suggest you read A Whole New Brain by Daniel Pink. It is his thesis that this country will export all of its tech work - IS, accounting, etc, in addition to the already exported manufacturing sector, to the cheaper global-based labor forces in increasing amounts as time goes on. He believes that what America <em>will</em> still have left to offer is creativity - the designs for all of the creations being made overseas.</p>

88

<p>
[quote]
This is not correct for all tax credits. They can be refundable (you get money in excess of your tax liability) or not refundable (they just reduce your tax liability - you do not get a 'refund' of any excess). For instance the current education tax credits (the Hope and the lifetime learning) are not 'refundable credits' which means that they reduce your tax bill but you do not get a refund of any excess. The maximum Hope credit for 2008 is $1800. If you have in excess of $1800 in taxes you may get the full $1800 wiped out (if otherwise eligible). But if you have $600 in taxes then you save the $600 in taxes - you do not get another $1200 paid to you.</p>

<p>The new (or expanded) education credit is part refundable and part not. The total possible credit is $2,500 (based on 100% if the 1st $2000 of tuition and 25% of the next $2,000). Up to 40% of it is refundable, so up to a maximum of $1,000 may be paid to someone with no tax liability.</p>

<p>The new credit (the American Opportunity tax credit is it's name in the bill) is not a completely new thing but is an expanded version of the Hope credit. $2500 instead of the current $1800. Available for 4 years of school rather than 2 years. Partly refundable ($1,000). I think the lifetime learning credit (which is not refundable) is still available for those who do not qualify for this.

[/quote]
^^^swimcatsmom</p>

<p>Thanks for this valuable educational post! I was never clear on the Hope tax credit and you've finally tied it all together for me. Thank you!</p>

89

<p>
[quote]
And the slight increase in Pells won't be enough to cover for the usual 6%+ yearly increase in tuition. Tax credits as noted would be of little value to many as their economic status precludes benefiting from it. Essentially for much of the population at the CC's any tax reduction will go immediately for such as car repairs or to avoid evictions. So whatever results from a small educational tax breaks is not going to be applied for education. For this class the economies so bad that patches for immediate problems now have to take precedence. As is very evident from the situation at the CC in my community-when the Pell checks were distributed a sizable contingent of those students were over at the WalMart buying basic commodities (rice & ramen noodles). Books and supplies are a non-issue if someone hasn't been able to eat properly or at all. And supplementary jobs (if one can get one or keep it with all the layoffs) no longer pay enough to be relevant, most of these students do have them but are still needing to use the Pell money for otherwise than educational uses. </p>

<p>Our governments incredibly inconsistent on education and social issues, some monies are being freed up for student support but not nearly enough. But it appears there are other facets of the government who have reason to be very concerned about our educational situation and possible social repercussions.

[/quote]
^^^Atana</p>

<p>This is such an accurate assessment that it beared repeating. It continually shocks me to see that some people really have no idea what is going on, how bad it is, and how bad it could potentially get.</p>

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<p>It is shocking and for many in academe enough to shake the ivy off the towers. </p>

<p>And what's socially and ethically obscene is that while the students and families are losing the resources to obtain an education-the shills for the educational corporations keep handing out the billions and assume nobody notices. </p>

<p>Socially we are going to have to decide which is more important, education for the common people or funding a system wherein much of the educational resources are first channeled into corporate troughs and then redistributed to students and families. </p>

<p>It'll have to be one or the other, as the situation stands now American higher education is in deep trouble and cannot support both systems for much longer. And that choice will be a definite bellwether of who and what our representatives actually serve. </p>

<p>And esteemed Mia, perchance on the moral scale where do corporations which have received billions in government, student & families resources but still cannot effectively function without yet more government largess, stand?
Fendergirl (whosoever she is) and however idealistic or naive she may or may not be, probably hasn't collected some 50+ billion in subsidies this year for services which do not properly serve their intended mission. It would seem your criticism in this instance is perhaps greatly misdirected.</p>

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<p>The whole education thing is a big scam anyway. In the 70's and 80's not as many people went to college as do today, and due to this college graduates made more than HS graduates. The reason was they could do a limited number of jobs that the HS grads couldn't. The lower enrollment numbers made finding jobs much easier and wages were high.</p>

<p>If we look at todays environment, so many students go to college that it is not at all special, its the norm. There are hundreds of college grads applying to each position. The sad fact is that when so many students go to college, the other professions such as the trades are left without workers. The limited supply of trades people and the over supply of college graduates, has made the wages current and future colleges grades expect to earn drastically drop. In the other hand in NYC a Plumber or electrician on the New Yankee stadium expected to make 75K a year. People new to the trades can expect upwards of 55K starting out and those with experience expect a lot more. </p>

<p>So in my opinion the entire college thing is a scam. Even if you do manage to get a good paying job being a college graduate, you are likely to just have HMO health insurance or none at all, and many companies are now cutting retirement Benefits. Whereas if you didn't go to college and went to a tech school, and became a Electrician. You could expect to make 55K a year starting out, get incredibly good health insurance via the Union and have a pension for the rest of your life. You can then retire after 20 years. </p>

<p>I don't mean to criticize those who are in school, because I am a student to and just want to bring this up for the new folks. I only have knowledge of the Tri state area around NY. I cant speak for the rest of the country, but that certainly is how it is here.</p>

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<p>dr horse, it just depends on the company. i'm a college graduate with a good paying job... with health insurance coverage that is not an HMO, a 401k which my company matches my contributions, and a pension plan which I am fully vested in. I've been there four years.</p>

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<p>Yeah There are still many employers that do still do the right thing, what I am trying to say is that they are harder to find.</p>

94

<p>I too am angered by the dual class system that is developing: the folks who work hard, save money, and play by the rules are suppose to subsidize to unproductive portion of society. More and more the incentive to be "poor" increases, while success and hard work are slammed. </p>

<p>I don't want to subsidize your kid; I've having enough challenge paying full-tuition now.</p>

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<p><<i don't="" want="" to="" subsidize="" your="" kid="">></i></p><i don't="" want="" to="" subsidize="" your="" kid="">

<p>so are you saying you don't think there should be any federal aid for college, either in the form of grants (Pell, etc) - we don't qualify for those), or guaranteed loans (what a blessing - someone guaranteeing to lend my son 25K+ in stafford/perkins loans)</p>

<p>or are you saying the colleges shouldn't spend their OWN money to give out to students whose parents can full pay (which is how my son can afford to go to NYU).</p>

<p>Did you just say, that either a student should be a 'full pay' at whatever school they can afford, or they can't go to college?</p>
</i>

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<p>There exists a huge inequity in life that begins at birth. Who your parents are, how savvy they are, how much money they have, how much they are able to help you makes a very big difference in your opportunities. One of the things we attempt to do with education is to level the playing field somewhat. You would think that once someone is 18, that the shackles or boost that parents provide would be minimized. The way the college financial system is designed continues this dependence on parents.</p>

<p>If your parents flat out refuse to fill out FAFSA, you are going to be limited in your choices. No financial aid for you. Merit is the only way to go. If they refuse to pay for your college, it's a big problem too, as their expected contribution looms big in the aid you will receive. </p>

<p>By the time you are 24, and considered independent, it's no easy thing to get a lot of financial aid either. It's not easy.</p>

97

<p>^^^^toadstool, sueinphilly, kayf, atana, cpt, mia, fendergirl & everyone participating in this thread who I have missed,</p>

<p>I saw Slumdog Millionaire last night for Valentine's Day. If we don't subsidize the poor with the opportunity for education, this is a window into our future. I highly recommend everyone seeing this movie.</p>

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<p>MattsMom, I don't think so. India is still considered a developing 3rd world country as in China. America has never been such, and the possibility of the US moving backwards into such a state are almost nill and impossible.</p>

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<p>Mattsmom, we do subsidize poor in this country and do provide opportunities.</p>

100

<p>When you start hearing that an "inflationary depression" is in the realm of possibilities on CNBC, nil and impossible just go out the window.</p>