A College Tax Credit for the Life of Your College Loans
by Gayle
(NY)
Since my student loans are going to total a lot more than $1,000 per year, I think this tax credit should last for as long as I'm paying.
That's the sort of financial aid award that makes sense. Its going to be a long time before I'm financially capable of owing the federal government much (at least in income taxes) so that refund will at least make me feel that college was worthwhile.
With loan forgiveness programs dropping off the face of the earth because states are losing money and can't afford them, the American Opportunity Tax Credit could be their replacement for graduates who can't afford to make their loan payments. And that's just about everybody who has graduated in the past year or so. If the jobless recovery keeps up, like most experts say it will, you're looking at graduates 3 and 4 years from now that won't be able to pay.
If this credit is not extended past the four years it takes to go to college, you're going to see a lot more defaults. And the lack of jobs will keep everyone from trying to graduate too quickly. You're going to need some kind of incentive to get people to get their degrees and start paying back their loans.
