Pennsylvania House Passes Bill to Alleviate Student Debt with Employer Tax Breaks
Pennsylvania Bill Offers Tax Breaks for Employer Contributions to Employee Financial Assistance
HARRISBURG, Pa. (AP) – In Pennsylvania, a new bill has just passed the House of Representatives, aiming to ease the burden of student debt. Under this bill, employers can get a tax break if they help their employees save for education. They can contribute up to $500 per year to an employees tuition savings account and get a tax credit on their total contributions. These savings accounts can be used for educational expenses like tuition and books which could reduce the need for borrowing in the future.
The sponsors of the bill highlight the staggering student debt in the country which totals $1.77 trillion. They believe this legislation could ease the financial strain on students. Pennsylvania currently ranks poorly in college affordability with high tuition rates and students leaving with significant debt. By encouraging employers to contribute to tuition savings accounts for their employees the hope is to make education more accessible and affordable.
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Financial Assistance – Pennsylvania House Approves Bill for Student Debt Tax Credit (PHOTO: fox43.com)
Anticipated Impact and Cost-Benefit Analysis of Pennsylvania’s Education Savings Bill
If this bill becomes law, it could impact around 600,000 tuition savings accounts owned by Pennsylvania employees. The estimated annual cost to the state would be around $65.7 million if every eligible account received the maximum contribution. However, supporters argue that the long-term benefits of reducing student debt and increasing access to education outweigh the initial cost.
