Friday, January 24, 2014 | 7 comments

Income Tax Credit for Home-schooling Families


To track the status of this bill, find it on our Legislation Tracker.
Click here to contact the sponsor of the bill to share your thoughts, or
click here to email your Senator and Representative about it.

Libertas Institute supports this bill.

Below is the executive summary for our newly released policy analysis, “Income Tax Credit for Home-schooling Families.” To read the entire report, click here. The resulting legislation is House Bill 77.

The Utah Constitution requires 100% of the state income tax to be used as revenue for government education services—“public” and “higher” education.

Families who choose to educate their children outside of this taxpayer-funded system must therefore pay for the education of others’ children before their own. Curriculum, learning kits, field trips, travel costs, and other necessary expenses are post-tax costs. The state, by imposing an income tax, requires these families to financially prioritize the education of other children first.

To encourage behavior by and minimize the tax burden on select segments of the citizenry, certain tax credits are currently offered by the state. Examples include adopting a special needs child, employing a veteran, or contributing to a medical savings account. We believe that home-schooling families should be added to this list, given the income tax’s direct connection to education funding. If these families do not utilize public schools, their mandate to help fund them should be reduced. These families will still be required to fund the public education system through property and federal taxes; our proposal only addresses the Utah state income tax.

Many parents claim enough deductions and/or credits that leads to their income tax burden being significantly reduced, if not eliminated. Our proposed tax credit would not apply to such situations, as it is a nonrefundable credit—money will not be given to families as a subsidy. If they owe no income tax, then they will receive no benefit. The credit only applies to those who do owe the tax.

These deductions may not always be in place, however. One Utah legislator has proposed eliminating the personal deduction, which would significantly increase the tax burden upon large home-schooling families—thereby making it even more difficult for them to fund their children’s educational needs.

Before helping to pay for the school costs of other children, Utah families should be allowed to meet their own family’s needs, and the current tax structure does not allow for this. Our proposal helps to remedy this imbalance.

Click here to continue reading.




6 comments
Vernon
Vernon

Do you know if property taxes or income taxes pay the majority of support of the local school districts?  I wonder if this shouldn't be a property tax credit, rather than an income tax credit.  

The net effect to the family receiving the credit is the same, but the impact on the State or local district budget could be significant, depending on the line item from which this $500 is to come.  


Any insight on this, Connor?


Barem
Barem

Seems like a good initial step away from the current socialist system.

MichaelStoddard
MichaelStoddard

Yes but what about those who PAY for private schools ???

Clint Eagar
Clint Eagar

@Vernon  The issue, as I see it, with a property tax credit is that a lot of homeschoolers such as myself currently rent. This would preclude our family from the income tax credit.

deggertsen
deggertsen

@MichaelStoddard It would be a bad idea for the government to get involved in helping to pay for private schools. A good idea would be to give tax breaks for money spent on private schools. Any time the money touches the government means that the school is now government controlled (public). I don't want our private schools to become public schools. We already have those, they're called charter schools.

That said, this bill is a GREAT first step.

cboyack
cboyack moderator

@MichaelStoddard Baby steps, unfortunately. Should there be good political support for this, then next year we may propose exactly that.

Trackbacks

  1. […] House Bill 77, sponsored by Representative Dave Lifferth, would have provided an income tax credit for homeschooling families. It failed in the House 32-37. We will propose the same bill next year and hope for a more favorable outcome. […]

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