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For Ohio college students and families, the price of tuition may soon become more affordable.
On May 17, Ohio state Rep. Dan Ramos (D-Lorain) introduced new legislation, the Ohio Lets Everyone Achieve Right Now (LEARN) tax credit, targeted at reducing the cost of higher education. The tax credit is intended to cover 90 percent of a student’s costs for attending public college in Ohio.
This would be a change as Ohio ranks 45th nationally for college affordability, reported The News-Herald. Its 2017 college graduate class owed an average of $30,000 in federal or private loans, and overall, Ohio sits in the 14th spot in the country for the highest student debt. This compares to national figures of $27,975 for average college student loan debt. Federal student loan delinquency rates are 11.5 percent.
“Our economy increasingly demands a college degree, but for many Ohioans, college remains unaffordable,” Rep. Ramos said via a press release. “The Ohio LEARN program would allow graduates to focus on their careers and pursuing their dreams upon graduation—not managing decades of crippling debt.”
Today, the federal government requires colleges and universities to report their comprehensive educations costs. For students seeking aid, they complete the Free Application for Federal Student Aid (FAFSA). Using FAFSA information and college education costs, federal officials create an Expected Family Contribution (EFC). This represents a snapshot for the maximum potential out-of-pocket costs a family may pay for a student to attend a certain college, and the tax credit utilizes this data.
Ohio LEARN Details
The Ohio LEARN tax credit will generate an individualized, refundable state tax credit covering 90 percent of a family’s expected college costs; it discounts scholarship or grant aid by covering only the expected cost of the family. The tax credit will spread out over a 10-year period, covering a student’s total cost to attend. Students would still have to pay 10 percent of their college costs ensuring “an equitable amount of skin in the game for each student,” as noted in the release.
According to the program, the availability for Ohio LEARN would run annually after each taxable year for students paying cash or when loans are due for those financing their own education. They are considered the beneficiaries, and the tax credit would go to them. If parents pay for their children’s education, they would receive the benefit.
In the program’s initial year, it may cost Ohio up to $189 million, but Ramos said this would be offset by the money graduates would return to the economy through income versus paying off student loans, reported WOSU Public Media.
Author: Andrew Rombach
Andrew writes engaging and informative content for readers looking to find information about topics such as student loans, credit cards, personal loans, and small business financing. Andrew’s work has been featured in Market Watch, Bankrate, The Penny Hoarder, and the Lacrosse Tribune.