SCHUMER REVEALS: SOUTHERN TIER FAMILIES HAVE MORE THAN $72 MILLION IN UNCLAIMED COLLEGE TUITION TAX CREDITS - BINGHAMTON UNIVERSITY TO BEGIN NOTIFYING STUDENTS TO TAKE ADVANTAGE OF SCHUMER-AUTHORED TAX CREDIT
Credit Will Be A Major Boost For Middle Class Families - For Every $1 Spent on College Tuition, Families Could Get $1 Off On Taxes, Up To $2,500 A Year
According To U.S. Treasury 57% of New Yorkers Didn't Take Advantage of College Tuition Tax Credit Last Year, Leaving Over $72 Million Unclaimed In The Southern Tier - Schumer Says It's Not Too Late To Get Refund From Last Year's Taxes
Schumer Stands With Interim President Dr. C. Peter Magrath, Students And Staff As Binghamton University Announces Its Initiative To Notify Families of Schumer's College Tuition Tax Credit
Late last week, U.S. Senator Charles E. Schumer announced that Binghamton University has joined his campaign to make sure that every eligible family takes advantage of the Schumer-authored $2,500 college tuition tax credit. The credit provides middle class families with children in college with $1 back on their taxes for every $1 spent on tuition, up to $2,500 per year. But, according to the treasury, less than 50% percent of eligible families claimed the credit on their 2009 taxes. Last year's returns can still be amended, which means that New York families in the Southern Tier are still eligible for $72.5 million in savings.
Standing at Binghamton University, Schumer was joined by Interim President Dr. Peter Magrath and staff from the University who announced their initiative to make their students aware of this tax credit. Schumer is now urging other New York State colleges to follow suit.
"At a time when the cost of a college education is rising faster than ever, $2,500 could make a real difference in a family's ability to pay tuition," said Schumer. "Unfortunately far too many families don't know that this credit exists, but the good news is that it's not too late to put that cash in your pocket, even if you didn't take the credit last year. That's why I'll be working with Binghamton University and its Interim President Dr. Peter Magrath to make sure that we are leaving no stone unturned in getting this information out to college students and their parents."
The Schumer-authored college tuition tax credit was originally signed into law as part of the American Recovery and Reinvestment Act of 2009, but was due to expire at the of 2010. However, Schumer was able to include a 2-year extension as part of the tax package that passed the Senate earlier this month. The legislation transformed the existing HOPE tuition credit into the $2,500 American Opportunity Tax Credit. The new Schumer credit represents an overall benefit that is at least two-and-a-half times greater than the previous tuition benefits. For families with children in college but who do not have enough income tax liability to qualify for the full credit, the law provides a refund worth up to 30% of the credit for each student.
In October of 2010 the U.S. Treasury released a report ( http://www.treasury.gov/about/organizational-structure/offices/Tax-Policy/Documents/AOTC%20report%2010.12%20FINAL.pdf ) that shows that while the tax credit makes a big difference for those who take it, only 43% percent of New York eligible families claim it on their tax returns. Because last year's tax returns can still be amended, that means that there is likely over $1 billion that New York families could claim right now, in addition to the tax savings they would see on next year's tax bill.
Middle class New Yorkers across the state will see benefits from the extension of the college tuition tax credit. According to a Schumer's report, compiled by using data from the U.S. Treasury and the New York State Education Department, New Yorkers in the Southern Tier have $72.5 million in unclaimed tax credits from their 2009 tax filings. By amending those filings, New Yorkers could see that money in their pockets. Below is a chart showing unclaimed college tuition tax credits by region:
Families in the Broome have $7.2 million in unclaimed credits.
Families in Allegany have $20.3 million in unclaimed credits.
Families in Chemung have $1.8 million in unclaimed credits.
Families in the Delaware have $3.6 million in unclaimed credits.
Families in Otsego have $7.8 million in unclaimed credits.
Families in Steuben have $5.9 million in unclaimed credits.
Families in Tompkins have $25.7 million in unclaimed credits.
In the last decade, college tuition has skyrocketed across the country in light of rising costs. With the recent tightening in the student loan credit market, more students of all income levels are being forced into borrowing from both federal and private lenders to finance college and they are borrowing in higher amounts than ever before. Others are forced to make tough decisions about whether or not higher education is affordable. According to the federal Advisory Committee on Student Financial Assistance, cost factors prevent 48 percent of college-qualified high school graduates from attending a four-year institution and 22 percent from attending any college at all.
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