From the fall of 2001 to this year, average in-state tuition at public universities has increased 211%, out-of-state tuition 171%, and at private institutions 144% — in what has been two decades of ballooning costs for better education.
With those expanding expenses naturally followed a robust loan market, which has strapped families and their graduates to the gurney of eternal debt.
A plethora of political plans — free college tuition, free community college, erasing the still-growing $1.5 trillion student loan bubble — have bitterly fallen to the wayside in bipartisan discussions, arguments bringing little fruition.
With trade school, junior college or multi-year post-secondary education as important as it’s ever been in America’s workforce, some debt solution needs to become a reality — and Kentucky U.S. Senator Rand Paul has an idea:
Make student loan payments 100% tax-deductible.
As things currently stand, the Internal Revenue Service annually allows up to $2,500 of student loan interest — or the amount of interest actually paid that fiscal year — to be deducted. But as inflation affects all facets of life, Paul doesn’t believe the $2,500 allowance is enough.
According to U.S. News & World Report, college graduates from the Class of 2020 rolled up an average $29,927 in student loans. And those totals are only expected to increase in short-term extrapolation.
Called the “Tax-Free Education Act,” Paul plans to file very soon, and the bill already has some Republican support.
This isn’t the first time in Paul’s political career where student loan debt has been in focus.
In late 2019, the Kentucky senator wanted to combat the rising debt load of higher education by allowing families to dip into retirement savings to alleviate loan payments.
Under his language, individuals would’ve been able to take up to $5,250 annually from 401(k) or IRAs — tax and penalty-free — to liquidate, with parents granted much higher allowances.
Introduced to the U.S. Congress on December 2, 2019, with co-sponsors John Kennedy (R-Louisiana) and Thom Tillis (R-North Carolina), the bill died on the floor after not receiving a vote.
