Tuition Tax Credits

While school vouchers have captured the headlines, a different policy has captured the students. Tuition tax credit laws are now entrenched in Arizona, Florida, Pennsylvania, Rhode Island, Iowa, and Georgia, and they affect far more students. Yet few people understand the nature of these policies or the political and legal issues surrounding them. This book provides a comprehensive analysis of the structure, legality, and policy implications of tuition tax credits, which have garnered only scant attention even while expanding to cover more students than the voucher policies they're designed to emulate. At a time when tax credit policies are becoming a major form of American school choice, this book offers insights into both the strengths and weaknesses of the approach. Book jacket.

While school vouchers have captured the headlines, a different policy has captured the students. Tuition tax credit laws are now entrenched in Arizona, Florida, Pennsylvania, Rhode Island, Iowa, and Georgia, and they affect far more students. Yet few people understand the nature of these policies or the political and legal issues surrounding them. This book provides a comprehensive analysis of the structure, legality, and policy implications of tuition tax credits, which have garnered only scant attention even while expanding to cover more students than the voucher policies they're designed to emulate. At a time when tax credit policies are becoming a major form of American school choice, this book offers insights into both the strengths and weakness ofthe approach.

Students who attend post-secondary educational institutions in Canada are eligible to apply for a non-refundable tax credit for tuition fees and related expenses. The tax credit for these expenses, which is administered by the Canada Revenue Agency (CRA), reduces the amount of income tax the student has to pay. This tuition tax credit is also available to students who attend certain educational institutions outside Canada, provided the institution meets conditions set out in the Income Tax Act. We took note of several media accounts of students who had attended even well known universities outside Canada and were nonetheless denied the tuition tax credit. Our Office also received complaints from students attending educational institutions outside Canada who felt, as a result of being denied the tuition tax credit, that they were being treated unfairly by the CRA. Our investigation found those complaints to have merit. In this report, the Ombudsman recommends that the CRA continue to ensure that the assessment of claims for the tuition tax credit be based on the provisions of the Income Tax Act and not solely on internal practices. The Ombudsman also recommends that the CRA do more to inform Canadians about the availability of tuition tax credits for expenses incurred attending educational institutions outside of Canada, as well as the eligibility criteria.