New research and evidence is showing that a 20 billion dollars in tax credits for college expenses has little influence on encouraging people to attend college. The tax benefits were created to get low income college students in and through college. The IRS released dozens on data sets, which show that college enrollment rises with income, but this is not exactly true. One explanation could be that the credits mostly go to middle and high class families, whose decision to attend college is usually not affected by a small savings. Another explanation could be that credits are given too late to affect enrollment.Students and parents usually don't receive the tax benefit until after tuition is due. Some people cant afford to wait. The process is currently being edited to hopefully raise college enrollment rates. 20 billion dollars is a lot of money. Lets not let it go to waste.
http://www.nytimes.com/2016/04/20/upshot/how-to-use-tax-credits-to-increase-college-attendance.html?ref=economy
They should change this tax credit program so that it can benefit more low income students. They also need to restructure the program so that students and families receive benefits before they have to pay tuition. It is very upsetting to me that a program like this is currently ineffective as you have explained it.
ReplyDeleteIt's good that people are trying to figure out what makes more students go to college, but at the same time it is a bummer to realize that they are failing to do so with stuff such as tax credits. But, at least we are trying, and I think we are on the right track and will find out what helps people with low income go to college soon.
ReplyDeleteThis comment has been removed by the author.
ReplyDeleteWhat many politicians fail to understand is that in order to increase the amount of young people in college is to decrease the opportunity cost. Many people from the lower class do not perceive a college education to be within their realm because they are required to work in order to support themselves or their family members. My mother grew up in a low income family - some of her siblings did not complete high school and she was the only one to graduate from college. They all needed to work in order to put food on their table. Their opportunity cost of staying in school was too high at the moment. Yes, they have a much lower quality of life today, but their instant needs called for them to enter the workforce.
DeleteI could definitely see how these small savings will not work as intended. It seems as though the demand for secondary education is rather inelastic. Decreasing the cost of college will not result in an increased enrollment as long as the opportunity cost is high.
What many politicians fail to understand is that in order to increase the amount of young people in college is to decrease the opportunity cost. Many people from the lower class do not perceive a college education to be within their realm because they are required to work in order to support themselves or their family members. My mother grew up in a low income family - some of her siblings did not complete high school and she was the only one to graduate from college. They all needed to work in order to put food on their table. Their opportunity cost of staying in school was too high at the moment. Yes, they have a much lower quality of life today, but their instant needs called for them to enter the workforce.
DeleteI could definitely see how these small savings will not work as intended. It seems as though the demand for secondary education is rather inelastic. Decreasing the cost of college will not result in an increased enrollment as long as the opportunity cost is high.
I agree with what Charlie says, the credit program should benefit low income students and families. I think a big reason this program failed is because federal aid has already been made to students who want to go to college. Making more funds available to people who don't want to take the time to get an education won't increase enrollment.
ReplyDelete