Monday, November 20, 2017

The Grad Student Tax

By now as you've read from Luca or Scott or PhD Comics or a variety of other sources on the dangerous changes to the tax code that passed the US House of Representatives last week. Among a number of university unfriendly policies, the tax code will eliminate the tax exemption for graduate student tuition for students supported with teaching or research duties, nearly every PhD student in STEM fields. The CRA, ACM, IEEE, AAAI, SIAM and Usenix put out a joint statement opposing this tax increase on graduate students. This is real.

Without other changes, a tax on tuition will make grad school unaffordable to most doctoral students. In computer science where potential PhD students can typically get lucrative jobs in industry, we'll certainly see a precipitous drop in those who choose to continue their studies. Universities will have to adjust by lower tuition, if finances and state law allows, and raising stipends. US government science funding will at best remain flat so in almost any scenario we'll see far fewer students pursue PhD degrees particularly in CS and STEM fields. Keep in mind we already don't come close to producing enough CS PhD students entering academia to meet the dramatically growing demand and these moves could frustrate faculty who also might head off to industry.

The current senate proposal leaves the exemption in place though no one can predict what will happen the the two bills get reconciled. In the best case scenario this bill goes the same way as the failed health care reform but republicans seem desperate to pass something major this fall. So reach out to your representatives, especially your senators, and express the need to leave in the exemption.


  1. I thought that under the current tax code only $5,250 of tuition remission was tax-free per year. I also thought that $4,000 in tuition was tax-deductible in general. Wouldn't that mean students would only be seeing a $1,250 change in their taxable income?

  2. Just a question - how did the US universities calculate the "presumed tuition" to be as high as $50K per year? Where I live the tuition (before government subsidy) is calculated to be less.

  3. "As high as $50K per year" is what you'd pay at some private universities for graduate student tuition if you were a self supporting student. In the STEM disciplines virtually all graduate students work as research or teaching assistants and get tuition remission. For an RA, the tuition is then charged to a grant and is not counted as income to the student by the IRS. This is a special case, different from the treatment of tuition remission for full time employees.

  4. Are you sure that, as you say, "we already don't come close to producing enough CS PhD students entering academia to meet the dramatically growing demand"? It seems like for every open faculty position in CS, there are tons of qualified applicants knocking on the door.

    And regarding contacting senators and the like, it seems pretty futile from the perspective of someone living in areas where the relevant politicians are already guaranteed not to vote for the bill.

    1. feels like too many CS departments want profs who will bring in middle six figures of grants a year rather than educators who can also do good research