as a grad student at Stanford (EE) in the 80s I was an “RA” but it wasn’t any different than just doing my PhD. The “work” involved was simply doing my research and writing papers with my advisors. So I don’t think that “signing up to be an RA” is really that much of a big deal, at least in my experience.
IME, RAs rarely work on just (or even primarily) their work as part of their RA. They work for whoever is funding the RA.
My funding package breaks down like this: 3 years of fellowship, 2 years of TA/RA (most do 2 TA but some, like me, get an RA instead because their advisor or whoever has funding and can hire them).
When I was an RA last semester, I was expected to work on my advisor’s project for 20 hours/week and as compensation, her funding paid my salary and for the tuition waiver.
Now fellowship years is when you only work on your stuff. You get a tuition waiver because it’s part of the fellowship and you’re given that fellowship in return for being a student and providing your intellectual labor. It’s part of our apprenticeship.
This plan would tax all of these tuition waivers.
Now, when I was getting my professional degree, did have a partial scholarship- which is different from the waiver. It was not given to me in the recognition that this degree was part of my apprenticeship into the academy but rather as a way to attract my “talent” and boost their numbers.
I don’t believe that to be correct. Your fellowship is now and will remain tax free.
From UM’s own words:
The operative word here, is that a scholarship/fellowship is NOT a tuition waiver. Its for merit (to get you to enroll there vs, some other program). No different than the thousands ($$) of merit money that 78% of UM-Law students receive each year. So, you are covered for at least 3 years of your program.
And if it works for Law and Med (and Public Health), why would it not work for PhD programs?
@bluebayou, because law and medical students are not required to help with research or to teach class.
When I was an RA, I was just working on “my” stuff, which was a research project under the greater auspices of my advisor. The 4.5 years during which I worked on my dissertation research were 3.5 years RA and 1 year as a TA (after the research funding ran out). Advisors stretch to cover it any way they can.
Exactly, and it is that ‘requirement’ that makes this a taxable event. (IMO, the unis should pay thier doctoral students a cash stipend for TA’ing classes.)
S gets a cash stipend AND a tuition waiver. As did I. Currently, they only tax the stipend. I can’t see this bad idea making it through congress.
Yes, they get a stipend already that is taxable.
I can.
If we’ve learned anything this past year, it’s that the unthinkable isn’t.
One of the arguments for taxing the tuition waiver is that some of it comes from outside corporations. The outside corporations (pharma, GE, oil companies, or the government) awards a contract to a university or professor in exchange for research and the deal includes the money for the tuition waiver. The university is getting the tuition money and the corporation is getting the work done. The corp isn’t paying taxes on that salary for the work it is getting, and would otherwise have to pay someone to do. Would they pay the student $50k for that work? Maybe not, but they’d certainly pay $10k-20k of instate tuition. It isn’t the same as a scholarship issued by the school from endowment fund or from a sponsored scholarship, it is money coming in for work that is to be performed.
If the tax bill does go through, the schools are going to have to justify that part that is a true scholarship and that part that is payment for services. If it isn’t payment for services, do they give as many grad scholarships to the English PhD students as the STEM ones? If it is school money, you’d think that would be the case or at least a lot closer than the current numbers.
Regardless of where the money comes from, it doesn’t help the student pay the extra tax when they are getting a stipend which is barely enough to subsist on. Why does this “cut” have to come partially on the backs of graduate students?
It seems to me that the US education system is the envy of the world. It produces cutting edge research, gives our country a commercial advantage and a highly educated workforce. Others want to come to this country to study. To tinker with a system like this, and at the clear expense of graduate students, is the height of foolishness.
This is really no different than other tax reforms in history. The government looks for ways industry ‘hides’ wages. The three martini lunch, company cars, country club memberships used to be paid for by the company and the employee got the benefit without having to pay income tax on the wages. The business would pay directly for all the things the employee would otherwise use his wages for and he’d stay in a lower tax bracket. It was basically a wash for the corporation (they’d pay the same amount in wages or in benefits, and deduct it either way). The old ‘company towns’ in the mining industry where the corporations owned everything and rented to the workers at a low price, so the company could then pay a low wage and the tax on the wages was very low, was another way to ‘hide’ income (and control employees).
Tax reforms have hit other company benefits too, like company housing, temporary housing, moving expenses. If a corporation can’t deduct it, then it’s likely to be a benefit that will be dropped. No one paid income tax on their nannies and domestic help until Nannygate in the 1980s, now everyone does. The government is always looking for ways to classify a benefit as income so it can college a tax.
If you go back an look at the 1986 tax reform bill, you’ll find a lot of things that hit one sector hard. Consumer debt was a big one but the banking industry didn’t care enough to fight for a tax deduction for their clients and consumers weren’t organized enough to fight for themselves. The question here is whether the corporation paying for these grad students and the research produced care enough to fight for it to remain an exception. Universities have a big lobby, but do they care enough about the students not paying taxes to fight for the students? They may have other things in the bill they need to fight about.
@twoinanddone – Do you think the universities will have time to lobby for their cause before this is voted on? Seems very different from 1986 and the hearings held then.
It doesn’t seem like this bill is targeting businesses in any significant way for their deductions, though. Universities are lobbying, but don’t know if it will be effective.
This bill is aimed at making the poor pay for tax cuts to the rich. I don’t think the administration or the majorities care much about universities or what they have to say
The majority of Americans do care about education. The majority of Americans think colleges have a net positive effect.
A small majority of the voting base of the party in power think college is negative.
That was a typo . I meant to say the majorities in congress. Thanks @romanigypsyeyes
I’m not sure the majority in Congress believe that. But I think they are afraid of their big donors and some of their constituents, so have/will vote for this bill that damages the higher education system.