House to Vote on Short-Lived Education Tax Breaks
By the end of this week, the U.S. House of Representatives is expected to pass a bill as early as Wednesday that would restore a slate of expired tax breaks, including three education-related measures.
This is precisely the sort of bizarre and wonky thing that Congress is known for doing: The tax breaks it would like to retroactively reinstate initially expired Jan. 1 of this year. The proposal would extend those tax breaks only through the end of this year, meaning they would once again expire at the end of December.
The move comes after President Barack Obama threatened to veto a tax deal that Majority Leader Harry Reid, D-Nev., and Rep. David Camp, the Republican chairman of the House Ways and Means Committee, were brokering. That developing proposal would have extended some tax breaks indefinitely, among other things.
The new proposal from Camp was filed Monday night, and the House will likely vote on it before the end of the week.
Here's a run-down of the education-related tax measures:
- Extension of qualified zone academy bonds: This allows K-12 public schools to borrow at low interest rates to help pay for new projects done in partnership with the private sector. Public schools with 35 percent or more of their student body eligible for free- or reduced-priced lunch, or public schools located in "empowerment zones"—schools in distressed urban or rural communities—are eligible for the funds. The bond proceeds are used for school renovations, equipment, teacher training, and course materials.
- Extension of deduction for certain expenses of elementary and secondary school teachers: This allows educators to deduct up to $250 for classroom supplies and is considered an "above-the-line" deduction, meaning the expenses don't have to be itemized.
- Extension of above-the-line deduction for qualified tuition and related expenses: This allows individuals whose adjusted gross income does not exceed $65,000 and joint filers whose adjusted gross income does not exceed $130,000 to deduct $4,000 for tuition and related expenses. It also allows individuals whose adjusted gross income does not exceed $80,000 and joint filers whose adjusted gross income does not exceed $160,000 to deduct $2,000.