Bill Overview
Title: Educators Expense Deduction Modernization Act of 2022
Description: This bill increases the tax deduction for the expenses of eligible educators from $250 to $1,000, An eligible educator is, with respect to any taxable year, an individual who is a kindergarten through grade 12 teacher, instructor, counselor, principal, or aide in a school for at least 900 hours during a school year.
Sponsors: Sen. Brown, Sherrod [D-OH]
Target Audience
Population: Eligible kindergarten to grade 12 school educators
Estimated Size: 4000000
- The bill is focused on educators, including teachers, instructors, counselors, principals, and aides working within the kindergarten to grade 12 range.
- It impacts those who are currently active in their educational roles for at least 900 hours in a school year, which suggests part-time or full-time employment in educational roles.
- The global scope includes educators worldwide who would meet the criteria if similar tax structures existed abroad, but realistically the financial implications are specific to the U.S. tax code.
- Only individuals filing taxes in the U.S. would directly benefit from this deduction increase.
Reasoning
- This policy specifically targets kindergarten to grade 12 educators who are likely to incur out-of-pocket expenses for classroom supplies and materials.
- The policy impacts mainly those educators who are actively filing taxes and are eligible under U.S. tax code guidelines.
- With a budget cap in place, this policy may only modestly augment the personal financial relief of educators, but the broader impact on mental wellbeing, driven by financial strain and professional support, could be substantial.
- Considering the American educational workforce of around 4 million, this policy might have a significant, albeit limited, financial benefit for each educator.
- Not all educators will reach the $1,000 deduction; some will benefit minimally, and others will use the full amount depending on spending habits and financial literacy.
Simulated Interviews
High School Teacher (Austin, TX)
Age: 34 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 12/20
Statement of Opinion:
- The increase to $1,000 is welcome, as I spend a lot on classroom supplies.
- It won't solve all financial worries but makes a positive difference.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 7 | 6 |
| Year 20 | 6 | 5 |
Elementary School Teacher (Cleveland, OH)
Age: 29 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 15/20
Statement of Opinion:
- It's a good step, as our salaries rarely cover unexpected costs.
- I feel more supported by the system with this deduction.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 6 | 5 |
| Year 20 | 5 | 5 |
School Counselor (Denver, CO)
Age: 45 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 7.0 years
Commonness: 10/20
Statement of Opinion:
- The higher deduction helps, especially when sometimes I purchase materials for student wellness.
- Every bit helps, but it doesn't change systemic funding issues.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 5 | 4 |
Principal (Los Angeles, CA)
Age: 52 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 3.0 years
Commonness: 6/20
Statement of Opinion:
- I appreciate the gesture, but principals have different financial strains.
- My wellbeing is more tied to school performance and funding than personal deductions.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 5 | 5 |
| Year 20 | 5 | 5 |
Teacher's Aide (Miami, FL)
Age: 26 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 0.0 years
Commonness: 8/20
Statement of Opinion:
- It's too early in my career to spend so much on supplies, but it's good to know I have this option.
- I haven't hit the deduction threshold yet.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 5 | 5 |
| Year 3 | 5 | 5 |
| Year 5 | 5 | 5 |
| Year 10 | 5 | 5 |
| Year 20 | 4 | 4 |
High School Instrutor (Boston, MA)
Age: 44 | Gender: other
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 10/20
Statement of Opinion:
- Tax benefits help, but education system's funding issues persist.
- Small financial relief allows more room for personal debts.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 5 |
| Year 2 | 6 | 5 |
| Year 3 | 6 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 5 | 4 |
Middle School Instructor (Baton Rouge, LA)
Age: 39 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 10/20
Statement of Opinion:
- This supports my frequent need to buy lab supplies.
- It's reassuring to receive more acknowledgment for personal contributions.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 7 | 6 |
| Year 10 | 6 | 5 |
| Year 20 | 6 | 5 |
Elementary Music Teacher (Seattle, WA)
Age: 31 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 10.0 years
Commonness: 8/20
Statement of Opinion:
- This deduction allows me to invest more in my music programs.
- More deductions would be even better given the scope of resources needed.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 5 |
| Year 2 | 7 | 5 |
| Year 3 | 7 | 5 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 5 | 5 |
Retired Principal (New York, NY)
Age: 60 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 0.0 years
Commonness: 5/20
Statement of Opinion:
- Though I am retired, I see how it benefits former colleagues.
- I wish these changes came sooner during my administrative career.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Assistant Principal (Chicago, IL)
Age: 42 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 0.0 years
Commonness: 7/20
Statement of Opinion:
- I believe this measure is more beneficial for teaching staff than administration.
- System changes often lead to more administrative tasks.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 6 |
| Year 2 | 6 | 6 |
| Year 3 | 6 | 6 |
| Year 5 | 6 | 6 |
| Year 10 | 6 | 6 |
| Year 20 | 5 | 5 |
Cost Estimates
Year 1: $660000000 (Low: $490000000, High: $830000000)
Year 2: $660000000 (Low: $490000000, High: $830000000)
Year 3: $660000000 (Low: $490000000, High: $830000000)
Year 5: $660000000 (Low: $490000000, High: $830000000)
Year 10: $660000000 (Low: $490000000, High: $830000000)
Year 100: $660000000 (Low: $490000000, High: $830000000)
Key Considerations
- The number of educators eligible for tax benefits depends on meeting the 900-hour work requirement, affecting the total cost.
- Marginal tax rates of beneficiaries significantly influence the impact on federal tax revenue reduction.
- The direct fiscal impact is a result of tax relief, contributing to a decrease in federal income tax revenue but potential slight increases in disposable income.