How the Tax Bill Affects Students and Families Paying for College

How the Tax Bill Affects Students and Families Paying for College<br />Although taxable income is lower under the current system —<br />and they lose the student loan deduction — the higher standard deduction, flexible family credits and a lower effective tax rate lower their overall tax bill<br />Additional child tax credit<br />Although taxable income is lower under the current system —<br />and they lose the student loan deduction — the higher standard deduction, flexible family credits and a lower effective tax rate lower their overall tax bill.<br />The tax legislation that House Republicans proposed last week includes several changes<br />that could affect student loans: the ability to deduct the interest on your loan would be eliminated; tuition paid by an employer would become taxable; and three existing tax breaks would be consolidated into one.<br />The loss of the student loan interest deduction is offset by the family flexibility credit and the near doubling of the standard deduction.<br />These two scenarios — calculated by Jackson Hewitt, the tax service — illustrate how much taxpayers would owe under the current system,<br />and how their tax bill might change if the Republican plan becomes law.