H.R.1905 - Protecting American Students Act (119th Congress)
Summary
H.R.1905, the "Protecting American Students Act," proposes an amendment to the Internal Revenue Code of 1986. The amendment aims to exclude certain students from the calculation used to determine if private colleges and universities are subject to the excise tax on net investment income. The bill also introduces a requirement for applicable educational institutions to report specific information related to the application of this excise tax.
Expected Effects
The bill's passage would likely reduce the number of institutions subject to the excise tax, as it narrows the criteria for student inclusion in the endowment threshold calculation. This could potentially free up resources for these institutions. It also adds a reporting requirement, increasing transparency regarding how the excise tax is applied.
Potential Benefits
- Potentially reduces the tax burden on some private colleges and universities.
- Could lead to increased financial flexibility for affected institutions.
- The reporting requirement enhances transparency in the application of the excise tax.
- May incentivize institutions to focus on supporting students who meet specific eligibility requirements under the Higher Education Act.
- Could indirectly benefit students through potentially increased institutional resources.
Most Benefited Areas:
Potential Disadvantages
- May reduce government revenue due to fewer institutions being subject to the excise tax.
- Could be perceived as favoring private institutions over public ones.
- The definition of 'certain students' may create administrative complexities.
- The benefits may disproportionately favor wealthier institutions with large endowments.
- Potential for unintended consequences related to student eligibility criteria.
Most Disadvantaged Areas:
Constitutional Alignment
The bill appears to align with the general welfare clause (Article I, Section 8) by potentially supporting educational institutions. However, the specific details of its implementation and impact on different types of institutions could raise questions about equal protection under the law. The bill does not appear to infringe on any specific constitutional rights or freedoms.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).