AN ANALYSIS OF THE TUITION TAX CREDIT PROPOSAL FOR HIGHER EDUCATION

The higher education tuition tax credit remains a popular form of federal assistance legislation in both the Congress and the present Administration. In light of this base of support for the tuition tax credit, successful enactment of a higher education tuition tax credit appears to be a real possibility. Since the future of higher education depends heavily upon continued federal funding, potential federal assistance legislation such as the higher education tuition tax credit is of significant importance to higher education. The purpose of this study was to analyze the perceived implications of the higher education tuition tax credit for both public and private higher education. A document analysis was employed to categorize, tabulate, and measure the main issues associated with the tuition tax credit which were identified from the available tuition tax credit literature. The primary focus of the study was to analyze the perceived implications of the higher education tax credit on both public and private institutions. The secondary focus was to analyze the proponent and opponent arguments to ascertain their significance to the tuition tax credit issue. Five main issues were identified and surveyed: Constitutionality, Access and Opportunity in Higher Education, Economic Effects of the Tuition Tax Credit on Higher Education, Comprehensive Effects of the Tuition Tax Credit on Higher Education, and Alternative Methods to the Tuition Tax Credit. The following conclusions were drawn from the study: (1) The constitutionality of the higher education tuition tax credit will be upheld by the Supreme Court. (2) The tuition tax credit will provide an efficient, easily administered, accountable, and controllable financial aid program which provides a tax incentive encouraging students to pay a portion of their educational expenses. (3) The tuition tax credit will not significantly affect either negatively or positively higher education because it is merely a tax incentive plan. To the extent that the tuition tax credit fulfills its purpose of encouraging students to pay a portion of their educational costs, the tuition tax credit will have a positive but minor effect on higher education.