[Congressional Record Volume 143, Number 42 (Thursday, April 10, 1997)]
[Extensions of Remarks]
[Pages E638-E639]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               THE COLLEGE STUDENT TAX RELIEF ACT OF 1997

                                 ______
                                 

                          HON. JOE KNOLLENBERG

                              of michigan

                    in the house of representatives

                        Thursday, April 10, 1997

  Mr. KNOLLENBERG. Mr. Speaker, in recent years the price tag on a 
college education has gone through the roof. Last year, the General 
Accounting Office reported that between 1980-95, tuition at 4-year 
public colleges and

[[Page E639]]

universities increased by a whopping 234 percent. In comparison, the 
Consumer Price Index increased by 74 percent and median household 
incomes--the measure of a family's ability to pay for college--
increased by 82 percent over the same period.
  With tuition increases outpacing inflation and the growth in family 
incomes, it has become harder and harder for students to pay for 
college without taking out loans and going thousands of dollars into 
debt. As a result, the average student loan has increased from $518 in 
1980 to $2,417 in 1995.
  Mr. Speaker, I rise today to introduce legislation that addresses 
this serious problem by strengthening the Federal work-study program. 
Under current law, earnings from this program are taxed. My bill, the 
College Student Tax Relief Act of 1997 excludes these earnings from the 
Federal income tax.
  The Federal work-study program enjoys strong bipartisan support 
because it rewards those who are willing to help themselves. This 
program provides jobs to needy students who must earn money to help pay 
their college expenses.
  By allowing these students to keep more of what they earn, my bill 
will significantly increase the take-home pay of working students and 
ease the financial burdens created by the aforementioned increases in 
college tuition.
  Consider the following example:
  Jennifer, an undergraduate student at a public university, qualified 
for a work-study award of $2,600. To earn her award, Jennifer worked 18 
hours a week during the school year--28 weeks--at the library and was 
paid $5.15 an hour for her services. During the summer--12 weeks--
Jennifer earned $3,600 by working as a receptionist in a law firm.
  Therefore, Jennifer's total earnings for the taxable year were 
$6,200.
  Under current law Jennifer would be able to deduct $4,000--the 
standard deduction for individuals who can be claimed as a dependent--
from her taxable income, leaving her with a tax burden of $332.
  Under my proposal, Jennifer's tax liability would be eliminated 
because she would also deduct $2,600--the amount of her work-study 
earnings--from her taxable income.
  Mr. Speaker, I urge my colleagues to co-sponsor the College Student 
Tax Relief Act of 1997. While $332 might not sound like a lot of money, 
it would help students like Jennifer make ends meet and minimize their 
student loan debt.

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