2015 Bills

Income Tax Credit for Home-schooling Families

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Libertas Institute supports this bill.

Below is the executive summary for our policy analysis released last year, “Income Tax Credit for Home-schooling Families.” To read the entire report, click here. The resulting legislation is House Bill 134.

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.

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