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Post by Pakachoag Phreek on Nov 28, 2017 5:38:51 GMT -5
Fr. B. sent out a blast email yesterday evening, addressed to members of the Holy Cross community, and calling attention to four provisions of the House tax bill that would adversely affect Holy Cross and Holy Cross students..
The closing paragraphs, I am 98 percent certain that this letter is a part of an outreach to alumni orchestrated by the Association of Jesuit Colleges and Universities.
I don't know whether all HC alumni received this missive, or only a certain group of alumni.
I'll guess that compared to the crusader moniker and mascot, far fewer alumni will write and express their views. And Tommy won't reach for the microphone.
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Post by Tom on Nov 28, 2017 10:26:36 GMT -5
Fr. B. sent out a blast email yesterday evening, addressed to members of the Holy Cross community, and calling attention to four provisions of the House tax bill that would adversely affect Holy Cross and Holy Cross students.. The closing paragraphs, I am 98 percent certain that this letter is a part of an outreach to alumni orchestrated by the Association of Jesuit Colleges and Universities. I don't know whether all HC alumni received this missive, or only a certain group of alumni. I'll guess that compared to the crusader moniker and mascot, far fewer alumni will write and express their views. And Tommy won't reach for the microphone. Alumni, or at least this alumnus, were included in the E-mail distribution
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Post by rgs318 on Nov 28, 2017 10:30:50 GMT -5
I received it as well.
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Post by KY Crusader 75 on Nov 28, 2017 11:31:04 GMT -5
I got it
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Post by hc811215 on Nov 28, 2017 11:39:28 GMT -5
I got it. The worst part of the bill is what it does to graduate students in STEM who typically get tuition waived and a small stipend in exchange for working as a TA and working in a lab 6 days a week. My daughter (HC '12) is finishing up her PhD in chemistry this coming Spring. Getting taxed on the waiver means you are taking home your $20,000-$25,000 annual stipend but being taxed as if you made $50,000 to 65,000 because the waived tuition will be deemed income to the grad student. Not a problem for my daughter who is almost finished but this is the type thing that might dissuade students from pursuing a graduate degree in STEM, especially in the first year at state universities when they are considered non-residents so the higher out-of-state tuition is being waived. I know we are not supposed to be too political here so I won't comment on other parts that i find objectionable; however, this does seem to be counter to our national interest in promoting cutting edge science.
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Post by KY Crusader 75 on Nov 28, 2017 11:51:51 GMT -5
Looks like colleges will have to increase those stipends to take care of the taxes on the tuition waivers...
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Post by hc811215 on Nov 28, 2017 13:25:48 GMT -5
Looks like colleges will have to increase those stipends to take care of the taxes on the tuition waivers... If universities have to increase stipends, they will need to reduce the number of grad student slots available, especially with their endowment income being taxed. Not smart for our country. It is already getting more difficult to obtain post-doctorate fellowships in science research as funding has been depleted. I fear this will only make matters worse. Has anyone read any rationale for this move that makes sense? Do we have to pay to allow the super-rich to inherit tax free by taxing grad students and college endowments? It seems like the priorities are backwards, but I may be missing something.
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Post by Pakachoag Phreek on Nov 28, 2017 14:12:53 GMT -5
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Post by crusader12 on Nov 29, 2017 8:05:14 GMT -5
While I agree that the tuition waiver being now treated as ordinary income is a bad idea, I find it ironic that Fr. B is concerned about a 1.4% tax increase on endowment income coming from a liberal arts college and putting that as concern #1. I guess anything to take the heat off the crusader is warranted at the moment.
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Post by hc811215 on Nov 29, 2017 8:44:48 GMT -5
While I agree that the tuition waiver being now treated as ordinary income is a bad idea, I find it ironic that Fr. B is concerned about a 1.4% tax increase on endowment income coming from a liberal arts college and putting that as concern #1. I guess anything to take the heat off the crusader is warranted at the moment. I believe the school uses some of that income for operating expenses and things like financial aid. I know they are struggling to retain their need blind admissions policy and the loss of significant income will only make matters worse.
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Post by Tom on Nov 29, 2017 9:06:48 GMT -5
While I agree that the tuition waiver being now treated as ordinary income is a bad idea, I find it ironic that Fr. B is concerned about a 1.4% tax increase on endowment income coming from a liberal arts college and putting that as concern #1. I guess anything to take the heat off the crusader is warranted at the moment. I believe the school uses some of that income for operating expenses and things like financial aid. I know they are struggling to retain their need blind admissions policy and the loss of significant income will only make matters worse. There are some rolling averages to steady market fluctuation, but I think the school uses 50 percent of the growth towards the annual budget.
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Post by sader1970 on Nov 29, 2017 9:06:59 GMT -5
It might be just me but I fail to see the irony as this tax would have a direct impact on Holy Cross and its ability to help meet the financial needs of students. Other issues he speaks to are less direct and more downstream. He was right to put this as his #1 concern, IMO.
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Post by Pakachoag Phreek on Nov 29, 2017 9:38:34 GMT -5
The college spends 4.5 percent of the endowment's fair value using a three year moving average with a one year lag.
The proposed tax is not on the fair value, but on the investment return.
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Post by alum on Nov 29, 2017 10:11:13 GMT -5
Just an idle thought----Why tax the tuition waiver for graduate students who are presumably the best and the brightest and not the athletic scholarship of the 85th player on the Alabama football team who is merely fodder at practice?
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Post by KY Crusader 75 on Nov 29, 2017 10:43:50 GMT -5
Just an idle thought----Why tax the tuition waiver for graduate students who are presumably the best and the brightest and not the athletic scholarship of the 85th player on the Alabama football team who is merely fodder at practice? There would be extraordinary opposition to taxing athletic scholarships and the race card would definitely be played.
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Post by sader1970 on Nov 29, 2017 11:17:12 GMT -5
Any enhancement to higher education in the United States should be considered a capital investment in our future and taxing colleges, universities, students, grad students, IMHO, is counter-productive. An educated populace will do a lot more to improve our economy and our society than more tax breaks for the mega-wealthy and corporations.
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Post by alum on Nov 29, 2017 11:29:40 GMT -5
Just an idle thought----Why tax the tuition waiver for graduate students who are presumably the best and the brightest and not the athletic scholarship of the 85th player on the Alabama football team who is merely fodder at practice? There would be extraordinary opposition to taxing athletic scholarships and the race card would definitely be played. No doubt about it. The difficulty is that there are so many competing interests who want their income to be nontaxable and their expenses to be deductible. In picking the winners and losers, Congress and the President will upset some people's prior reliance on the tax code. Many of those folks will be unhappy and it will cost some of them a lot of money. There is something to be said for treating all or almost all income as taxable, eliminating itemized deductions, having a good sized standard deduction, and a deduction per dependent, and then a progressive code with three different rates. Eliminate the corporate income tax but tax capital gains and dividends at the regular income rate. I'll even repeal the estate tax in exchange for doing away with stepped up basis on appreciated assets. I realize my plan screws over some who have made plans in reliance on the existing law, but you have to start somewhere.
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Post by Tom on Nov 29, 2017 11:52:44 GMT -5
Just an idle thought----Why tax the tuition waiver for graduate students who are presumably the best and the brightest and not the athletic scholarship of the 85th player on the Alabama football team who is merely fodder at practice? There would be extraordinary opposition to taxing athletic scholarships and the race card would definitely be played. Yet, a scholarship is a scholarship. I agree it would be hard to get rid of athletic ones, but what is the difference between a tuition waver and a scholarship of any kind. As written, I think they're only talking about grad school. I imagine someone like RJ Evans who was effectively a grad student with an athletic scholarship at UConn would have that taxed
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Post by Pakachoag Phreek on Nov 29, 2017 13:41:59 GMT -5
There would be extraordinary opposition to taxing athletic scholarships and the race card would definitely be played. Yet, a scholarship is a scholarship. I agree it would be hard to get rid of athletic ones, but what is the difference between a tuition waver and a scholarship of any kind. As written, I think they're only talking about grad school. I imagine someone like RJ Evans who was effectively a grad student with an athletic scholarship at UConn would have that taxed I agree. The fifth year transfers or fifth year redshirts in grad school receiving a football scollie would see that 'income' taxed. That is a BC-type concern.
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Post by Chu Chu on Nov 30, 2017 14:20:49 GMT -5
Just an idle thought----Why tax the tuition waiver for graduate students who are presumably the best and the brightest and not the athletic scholarship of the 85th player on the Alabama football team who is merely fodder at practice? To me, this tax bill looks like political favoritism run amok, with the vast majority of the spoils going to very healthy supporters. It is not reform, so much as it is kleptomania. 1.) It penalizes the states that did not vote Republican by disallowing longstanding, bipartisan deductions for those states existing taxes. These are the states, by the way, that already send more to the federal government than they receive back 2.) It takes away the mandate to have medical coverage. This will torpedo the ACA, and take medical coverage away from millions. 3.) It mandates new taxes on elite education institutions , and even on graduate students scholarships. Many will be hurt. 4.) It kills the estate tax, which only affects about 0.2% of all estates -- and only those worth more than $5.5 million. 5.) It repeals the Alternative Minimum Tax, which hits filers making between $200,000 and $1 million, who used loop holes and deductions to lower their bill 6.) It cuts large sums from Medicare to make the deficit look less bad. Those funds are needed in Medicare. 7.) It contains gimmicks that expire near the end oft he bills term, in order to make it look cheaper. No doubt, when these provisions are due to go away, our Republican friends will will rail against increasing taxes, and fight to keep them. All of this, and we massively increase our debt. Why? At a time when we need to step up and rebuild our infrastructure, insure the welfare of the next generation via support for education, deal with the opioid crisis and make medical care affordable for struggling families. Because we need to help business? We are currently experiencing the longest sustained expansion of our economy in history, Businesses are sitting on huge piles of cash. When President Bush and Obama increased our debt to fight the financial crisis, it was an existential time of mortal peril to our economy. This bill has no such excuse. I have no doubt that after the debt balloons, our Republican friends will next come back and say we must "cut entitlements" like Medicare, Medicaid and Social Security. You know that, too!
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Post by KY Crusader 75 on Nov 30, 2017 15:08:22 GMT -5
Ahh...politics
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Post by Pakachoag Phreek on Nov 30, 2017 15:20:28 GMT -5
The more direct impact of the tax cut is to reduce the applicant pool for HC going forward, and the economic demographics of the entering classes.
Most of HC's applicant pool is drawn from blue states where upper middle income households use deductibles to reduce their tax burden. Would not surprise me in the least to see HC experience a 25-30 percent drop in the number of applicants. The amount of fin aid that HC has and will have available isn't enough to expand to cover applicants from the financially strained upper middle class. Not the case of HYP and the others who already offer fin aid to the upper middle class.
This represents a far, far bigger crisis for HC than the nickname and the mascot.
However, my expectation is that in 2021, the tax cuts of 2018 will be revisited, more because the revenue won't be there, and the debt will be unsustainable. Happened both under Reagan and G H W Bush. .
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Post by sader1970 on Nov 30, 2017 15:44:33 GMT -5
Would agree a "bigger" crisis but not a "far, far bigger crisis" than the mascot. First, because I firmly believe that you put too much stock on statistics and underestimate the extremely strong undercurrent among many alumni donors that are "mad as hell and won't take it anymore" with the Crusader being the line in the sand. There is a significant minority of donating alums that are already on the edge and feel Holy Cross has lost its soul and this will push them over that edge. But, I agree that this tax "reform" is bigger for many of the reasons that you have given. The thing is, Holy Cross has brought on itself the former crisis which makes it worse than the latter which has been brought on by outside forces and in which the College has less control (almost none, really). Put together, both of these crises could put Holy Cross on the financial ropes for the foreseeable future.
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Post by KY Crusader 75 on Nov 30, 2017 16:09:56 GMT -5
The more direct impact of the tax cut is to reduce the applicant pool for HC going forward, and the economic demographics of the entering classes. Most of HC's applicant pool is drawn from blue states where upper middle income households use deductibles to reduce their tax burden. Would not surprise me in the least to see HC experience a 25-30 percent drop in the number of applicants. The amount of fin aid that HC has and will have available isn't enough to expand to cover applicants from the financially strained upper middle class. Not the case of HYP and the others who already offer fin aid to the upper middle class. This represents a far, far bigger crisis for HC than the nickname and the mascot. However, my expectation is that in 2021, the tax cuts of 2018 will be revisited, more because the revenue won't be there, and the debt will be unsustainable. Happened both under Reagan and G H W Bush. . I think you have exaggerated more than a bit in this statement of opposition to the bill
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Post by Tom on Dec 1, 2017 8:09:30 GMT -5
However, my expectation is that in 2021, the tax cuts of 2018 will be revisited, more because the revenue won't be there, and the debt will be unsustainable. Happened both under Reagan and G H W Bush. . Of course the debt is sustainable, we've been doing it for years. If every year we normally spend one trillion more than we have, what's the big deal if we start spending 1.5 trillion more than we have?
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