A bipartisan bill introduced last week would mean AmeriCorps alumni would not have to pay taxes on the educational awards they earn through their participation.
The Segal AmeriCorps Education Award Tax Relief Act of 2011, submitted by Rep. John Lewis (D-Ga.) and co-sponsored by Charles Boustany (R-La.), would amend the Internal Revenue Code to “provide an exclusion from gross income for AmeriCorps educational awards.”
AmeriCorps participants receive up to $5,000 in educational awards to be used for past, current or future college tuition, and the money is paid directly from the Corporation for National and Community Service’s National Service Trust to their student loan provider.
But unlike many other federally funded student assistance programs, such as Pell Grants and money under the G.I. Bill, grants for AmeriCorps participation are considered taxable income. CNCS sends recipients a 1099 form that delineates the amount of the award that was spent in a fiscal year.
“A full-time AmeriCorps member gives 1,700 hours of service, at very modest subsistence wages with no creature comforts,” said Ben Duda, executive director of the nonprofit AmeriCorps Alums. “We would like to see that that the education award is fully realized.”