{"id":12580,"date":"2016-10-05T09:00:28","date_gmt":"2016-10-05T16:00:28","guid":{"rendered":"http:\/\/www.nexusnewspaper.com\/?p=12580"},"modified":"2016-10-03T14:08:33","modified_gmt":"2016-10-03T21:08:33","slug":"calculated-thought-student-tax-changes-afoot","status":"publish","type":"post","link":"https:\/\/www.nexusnewspaper.com\/newsite\/2016\/10\/05\/calculated-thought-student-tax-changes-afoot\/","title":{"rendered":"Calculated Thought<\/em>: Student tax changes afoot"},"content":{"rendered":"

Students who are inclined to save will feel the crunch from recent changes to federal student benefits.<\/p>\n

The education and textbook tax credits save working students up to $558 per year. Analysts argue that this doesn\u2019t help students who may not be able to afford the up-front costs of post-secondary education (you have to wait for the tax refund), and worry that since the credits are not income-tested, benefits mainly go to wealthier students and their families.<\/p>\n

As of January 1, 2017, these tax credits will be no more. Replacing them will be an increase to the Canada student grants for low and middle-income families. <\/i>These grants offer $3,000 (up from $2,000) and $1,200 (up from $800) to low- and middle-income families, respectively, for those who qualify.<\/p>\n

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Calculated Thought<\/em> is a column dealing with student finances that is featured in every issue of Nexus<\/em>.<\/figcaption><\/figure>\n

The federal budget proposes that the money saved by slashing these tax credits will fund the increase to the grants. There\u2019s a caveat: you must be eligible for federal student aid to qualify for the grant.<\/p>\n

However, this leaves out some students who may meet the income requirements. If a single, financially independent student makes less than $24,144 a year, they meet the income requirement for the low-income grant. Students are assessed as in need of funding based on the equation \u201ceducational costs \u2013 student resources = financial need.\u201d<\/p>\n

Let\u2019s say a student has an income of $20,000 and has no assets (cash, RRSPs, a car, etc.), and their assessed need is $5,000. Up to $3,000 is awarded under the grant, and the remainder will be a loan. If a student with the same income has assets exceeding that need of $5,000\u2014say, $3,001 in the bank and a used car worth $2,000\u2014they are assessed as needing $0 in financial aid, and no grant is awarded.<\/p>\n

Was the tax credit fairer? Although it is admirable that this change aims to provide a larger benefit to those more in need, one could argue that taking away the tax credit ignores those who are savers and own some assets, even if it is only a safety net and a rusty Hyundai.<\/p>\n","protected":false},"excerpt":{"rendered":"

Students who are inclined to save will feel the crunch from recent changes to federal student benefits. The education and textbook tax credits save working students up to $558 per year. Analysts argue that this doesn\u2019t help students who may not be able to afford the up-front costs of post-secondary education (you have to wait […]<\/p>\n","protected":false},"author":2,"featured_media":12581,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[5,172],"tags":[],"class_list":["post-12580","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-columns","category-october-5-2016"],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t