[s0rin]

Someone please correct me if I'm wrong, but the waivers in question are aimed at students who receive tuition discounts due to working in a full-time capacity. Like a professor gets a tuition discount for their daughter who attends the school, or the admissions accountant gets a discount to attend the MBA program. [1] This means most students unaffiliated with the school would be protected from any tax on graduate school tuition aid.

Regardless, this is an interesting scenario (I say this as a tax accountant), since the university is a non-profit entity, and therefore doesn't receive any tax benefit for incurring this cost (whereas a for-profit company would deduct this as some sort of employee expense).

But instead of passing a tax onto the employee, it seems like the IRS waived the tax entirely since it could be interpreted as a contribution made by the university, to the university: the Uni pays the employee tuition, and the employee pays tuition back to the university. Since the tuition benefits can't be applied to other schools, it seems like a reasonable waiver.

On the other hand, we have a hefty amount of debt on our hands, and in order to dig ourselves out of it, the funds will have to come from _somewhere_. In an effort to "see randomness", this is what I'm hoping is the reason for the change.[2]

[1] the "145,000" student hyperlink in the article: acenet.edu/Pages/Higher-Education-and-Tax-Reform.aspx#tabContent-6 [2] http://www.paulgraham.com/randomness.html

[rsfern]

Most Ph.D. students receive a tuition waiver that's considered part of their compensation.

Example, my Ph.D. was paid for primarily through an NSF grant that my advisor was awarded. An engineering Ph.D. student at my university costs the P.I. a bit more than $100k per year -- $25k stipend for living expenses, $40k for tuition, and the rest goes to travel and university overhead.

I paid federal and state income tax on the $25k (not FICA), and the $40k for tuition was reported as tax-exempt income on my W2. Remove the tax exempt status on that tuition money, and my taxable income more than doubles without any increase in my ability to pay. It looks like the effective tax rate would be ~45% of the stipend, and that's not counting FICA or state tax burden [1].

Who is going to do a Ph.D. in the US if this change is enacted? This would seriously damage the workforce development pipeline.

Edit: I didn't realize the difference in the standard deduction, which isn't accounted for in the ADP estimate. It still works out to about 32% effective tax rate, which is still a significant addition to the opportunity cost of a 5-year Ph.D.

[0]: https://www.insidehighered.com/news/2017/11/07/grad-students...

[1]: https://www.adp.com/tools-and-resources/calculators-and-tool...

[mathperson]

I think you are just wildly wrong on 1. These waivers are a part of graduate school support for most if not all Phd programs. I.e. I do research, take classes,and perhaps TA. The university pays me a small stipend, and pays my 'tuition' for whatever courses I take, i.e. paying itself. That implicit part of my compensation WOULD be taxable.

"This means most students unaffiliated with the school would be protected from any tax on graduate school tuition aid."

This clearly not true from the article you cite and the verge article (see the comments by the spokeswoman). Where is this claim coming from?

[geofft]

> Someone please correct me if I'm wrong, but the waivers in question are aimed at students who receive tuition discounts due to working in a full-time capacity. Like a professor gets a tuition discount for their daughter who attends the school, or the admissions accountant gets a discount to attend the MBA program.

Yes to the first sentence - I don't think the second sentence follows.

When I was a graduate student, I was a teaching assistant, and I was paid to be a teaching assistant and received a tuition waiver. I was required to either teach a class or do funded research in order to get a tuition waiver, and presumably the money for that comes out of either the teaching salary budget or the research funding. I did also get a small amount of pay (a stipend) on top of the tuition waiver, basically enough to pay for housing and meals. I was employed by the school, I got a W-2 for that money, etc. So I was working full-time for the school. Having been accepted to the graduate program, I then became an employee of the university.

I didn't complete my degree, and I've thought about going back to finish it off, but unless I commit to spending a full semester there and apply for and receive a teaching or research assistantship, I'm paying sticker price for the degree program, no financial aid, nothing. That's a huge amount of money, even for someone who's now making a nice big-city tech salary. (And for the particular degree program, there's a limit on how many semesters an individual can be a funded teaching assistant or research assistant, and I only have one semester of that left.)

> On the other hand, we have a hefty amount of debt on our hands, and in order to dig ourselves out of it, the funds will have to come from _somewhere_. In an effort to "see randomness", this is what I'm hoping is the reason for the change.

I think it's basically that but a bit simpler - it's a regulation that's phrased in the way of being a tax waiver for people doing a thing, and the folks trying to do tax reform are just trying to lower the number of those regulations.