Apparently existing tax policies might help families trying to pay for college, if only Americans knew how to use them correctly.
According to an article by Michael Stratford in the Chronicle of Higher Education:
About 1.5 million tax filers in 2009 did not take advantage of the higher-education tax benefits for which they appeared to be eligible, according to a government report released on Monday.
The report, by the Government Accountability Office, says students and their families missed out on average tax benefit of $466. The missed savings totaled $726-million.
About 14 percent of Americans eligible for tax breaks for college education, like the American Opportunity Credit, the Lifetime Learning Credit, and tax deductions for interests on student loans, don’t use them. This is from a report recently issued by the Government Accountability Office.
GAO says the $726 million in unclaimed tax benefits indicate “improved tax information could help families pay for college.”
Yea, because Americans totally want to learn more information about their taxes.
Like with student loans, the problem is structural. “More information” is not the solution. If the tax credit is too complicated for taxpayers to understand and benefit from the intended purpose of that tax credit, change the tax credit.