ERD50
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
I learned that:
1) There are 2009 tax policies to reward pursuit of higher education.
2) There are 2009 tax policies to punish pursuit of higher education.
3) Both of these can apply to the same student in a family, one effectively counter-acting the other.
For #1, there are various education credits (with some refundable credit elements). So if the goal is to economically motivate people towards pursuit of higher education, fine.
But for #2, you can be 'punished' if your child has savings/earnings in their name. In some cases, this gets taxed at the parent's rate rather than the child's rate. But what really, really makes this weird is being a student is a negative in this case. So if the goal is to economically motivate people towards pursuit of higher education, this opposes the same goal that is supported in #1.
So, a 21YO who *is* a student can get taxed at their parent's rate.
But a 21YO who is *not* a student gets taxed at their own (probably lower) rate.
Counterproductive, no?
-ERD50
1) There are 2009 tax policies to reward pursuit of higher education.
2) There are 2009 tax policies to punish pursuit of higher education.
3) Both of these can apply to the same student in a family, one effectively counter-acting the other.
For #1, there are various education credits (with some refundable credit elements). So if the goal is to economically motivate people towards pursuit of higher education, fine.
But for #2, you can be 'punished' if your child has savings/earnings in their name. In some cases, this gets taxed at the parent's rate rather than the child's rate. But what really, really makes this weird is being a student is a negative in this case. So if the goal is to economically motivate people towards pursuit of higher education, this opposes the same goal that is supported in #1.
* Before a child reaches age 19 (24 for full-time students), the next $950 in income is taxed at the child's rate. Earnings above $1,900 are taxed at the parent's marginal rate.
* All income (after the first $950) earned by children age 19 and older (24 for full-time students) is taxed at the child's rate.
So, a 21YO who *is* a student can get taxed at their parent's rate.
But a 21YO who is *not* a student gets taxed at their own (probably lower) rate.
Counterproductive, no?
-ERD50