1.
(a)This Act may be cited
as the Leadership Invests in the
Future Through Helping Individuals Gain Higher Education and Retraining Act of
2012
or as the LIFT HIGHER Act of 2012
.
(b)Congress
finds the following:
(1)The median student loan debt for students
who graduated from college between 2006 and 2010 is $20,000.
(2)Application fees
for individual schools range from $40 to $140. The cost of taking the Graduate
Record Exam once is $150. Law school admission test preparation courses cost
upwards of $1,500. These costs make it difficult for many students to apply to
graduate school and discourage others from doing so.
(3)The percentage of
Americans with graduate degrees is continuing to rise, with 10.9% of the
population having graduate degrees as of 2011.
(4)Persons with
advanced degrees earn on average $3.2 million in their lifetime compared to
those holding a bachelors degree who earn about $2.27 million.
(5)It is in the
national interest to have highly educated citizenry.
(6)University
education is the best and most effective way to obtain professional training
and skills.
2.Refundable tax
credit for graduate school application expenses
(a)Subpart C of part IV
of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by
inserting after section 36B the following new section:
36C.Credit for
graduate school application expenses
(a)In the case of a
specified graduate school applicant, there shall be allowed as a credit against
the tax imposed by this subtitle for such taxable year an amount equal to the
qualified graduate school application expenses paid or incurred by such
applicant during such taxable year.
(b)
(1)The amount allowable as a credit under subsection (a)
with respect to any individual for any taxable year shall not exceed the excess
of $500 over the aggregate amount of the credits allowable under subsection (a)
with respect to such individual for all prior taxable years.
(2)Limitation based
on modified adjusted gross income
(A)The amount allowable as a credit under subsection (a)
(determined without regard to this paragraph and after the application of
paragraph (1)) for the taxable year shall be reduced (but not below zero) by
the amount which bears the same ratio to the amount which is so allowable
as—
(i)the excess (if
any) of—
(I)the taxpayer’s
modified adjusted gross income for such taxable year, over
(II)$60,000 ($120,000
in the case of a joint return), bears to
(ii)$5,000.
(B)Modified
adjusted gross incomeFor purposes of subparagraph (A), the term
modified adjusted gross income means the adjusted gross income of
the taxpayer for the taxable year increased by any amount excluded from gross
income under section 911, 931, or 933.
(c)Specified
graduate school applicantFor purposes of this section, the term
specified graduate school applicant means any individual who
applies to an eligible educational institution (as defined in section
25A(f)(2)) for acceptance into a program of postbaccalaureate study
leading to a graduate degree from such institution.
(d)Qualified
graduate school application expensesFor purposes of this
section, the term qualified graduate school application expenses
means amounts paid or incurred—
(1)as an application
fee with respect to applying for the program of study referred to in subsection
(c),
(2)as a fee for
taking any test which is required in connection with applying for such program
of study,
(3)for study and
preparation materials (whether printed or electronic) for any test referred to
in paragraph (2), or
(4)for tutorial and
preparation services for any test referred to in paragraph (2) if such services
are provided by a person approved or licensed under State law to provide such
services.
(e)Credit not
allowed to individuals who can be claimed as dependentsNo credit
shall be allowable under subsection (a) with respect to any individual with
respect to whom a deduction under section 151 is allowable to another taxpayer
for a taxable year beginning in the calendar year in which the taxable year
referred to in subsection (a)
begins.
.
(b)
(1)Subparagraph (A)
of section 6211(b)(4) of such Code is amended by inserting 36C,
after 36B,
.
(2)Paragraph (2) of
section 1324(b) of title 31, United States Code, is amended by inserting
36C,
after 36B,
.
(c)The table of
sections for subpart C of part IV of subchapter A of chapter 1 of the Internal
Revenue Code of 1986 is amended by inserting after the item relating to section
36B the following new item:
Sec. 36C. Credit for graduate school application
expenses.
.
(d)The amendments made by this section shall apply to taxable
years beginning after the date of the enactment of this Act.