January 29th, 2020
I do not believe people appreciate what they get for free. I have first hand experience in that regard, but there is not enough space to tell that tale here. I do, however, believe in incentives.
Right now, the various tax adjustments and credits for college expenses all have income caps (that are actually relatively very low). It would be great to change that so there are no income caps at all. Whether rich or poor, higher education costs are investment expenses you are choosing to make-- whether for yourself or a dependent. In the business world, investment expenses don't have a cap. We should apply that same thinking in the tax code with regard to higher education expenses.
Also, how about making Graduate tuition expenses have a refundable credit? If you are a starving student, there is a huge chance that you will not have enough income to generate a tax liability to fully take advantage of the Life Time Learning Credit. The American Opportunity credit for undergrads is a refundable credit. Ideally, we should take that credit and also apply it to Graduate students as well. Grants and scholarships are far more rare in the the world of the Graduate level degree. The other alternative would be to have the unused portion of the Lifetime Learning Credit be able to roll over to future years until fully utilize (similar to the approach we take to tracking capital gains losses). Once again, investment expenses should be fully deductible.
And one final idea, how about giving a Bonus Refundable Credit to those that graduate within 6 years as an incentive to finish quickly and to start being employed in that next better position.