The ADA called on the Ways and Means Committee to advance several pieces of tax reform legislation and policies ahead of its Oct. 25 hearing on Educational Freedom and Opportunity for American Families, Students, and Workers.
In a letter addressed to Rep. Jason Smith, R-Mo., chairman of the Ways and Means Committee, the ADA stressed that this legislation would help alleviate dental workforce shortages by decreasing student loan debt. The Association outlined four bills in particular that would “be especially helpful for those considering training as a dentist, dental hygienist, or other oral health care professional, and for all Americans who need access to dental care, especially those in underserved and rural areas.”
One bill, the Freedom to Invest in Tomorrow’s Workforce Act, would allow funds in a state-sponsored, tax-exempt 529 savings account – a qualified tuition program – to pay for expenses associated with acquiring and keeping postsecondary credentials. Under current law, beneficiaries cannot use 529 funds for postsecondary credentialing, including professional, voluntary certifications and licenses.
Another ADA-supported bill, the Student Loan Interest Deduction Act, would increase the student loan interest deduction from $2,000 to $5,000 and repeal deduction limits that don’t allow those living in high-cost areas to benefit.
“Raising the amount of the deduction and removing the income cap on those that can take advantage of the student loan interest deduction would make dental training more attractive by saving new dentists thousands of dollars annually,” the ADA said.
The Dental Loan Repayment Assistance Act would exempt repayment received for participating in the Dental Faculty Loan Repayment program from income tax. With 40% of the dental faculty workforce nearing retirement age and .4% of dental school seniors planning to enter academia, the letter states, the bill plays an integral role in helping dental schools recruit and retain faculty.
Finally, the Indian Health Service Health Professions Tax Fairness Act would allow health care professionals such as dentists who participate in the IHS Loan Repayment Program to exclude interest and principal payments from their federal income taxes, and give IHS employees the same tax status of those who receive National Health Service Corps and Army loan repayments.
Dental students average more than $300,000 in debt, the ADA noted, which makes the IHS’ loan repayment program an essential tool in recruitment, retention and even geographic distribution. According to the Association, exempting scholarship and loan repayment funds from gross income would make the program more enticing to future applicants.
The ADA emphasized that addressing dental student debt, education and credentialing costs is “a major step towards ensuring everyone has optimal access to oral health.”
“Thank you again for holding this hearing on education tax policy that will now only empower students to pursue the American dream, but which will also lead to great access to care for patients in need,” the letter reads. “We appreciate the opportunity to provide the perspective of America’s dentists and other oral health care professionals on these tax policies related to dental education.”