Indiana taxpayers are set to collect a $100 tax refund next year, thanks to Gov. Mitch Daniels' success in slashing spending on public schools, child protection and more. But some taxpayers received an early bonus with a new private school/home school tax deduction for textbooks.
The deduction so far, according to Chetrice Mosley of the Indiana Department of Revenue, has cost the state $2,649,091. About 44,000 tax filers have claimed $77.9 million in textbook and fees incurred at private and parochial schools and in home-schooling. The state grants filing extensions, so the number is likely to increase before a final figure is available at the end of the year.
Blogger Steve Hinnefeld wrote about the tax deduction at tax time. The key here is that the deduction is not available to families who send their children to public school, even though Indiana is one of just a few states that allow textbook fees. (Although school bus fees apparently are unconstitutional. Go figure.)
I checked with some local public districts about current textbook costs. At East Allen County Schools, the average textbook/fee bill this past year was $173. At Fort Wayne Community Schools, it was $98.31 for grades K-12. In both cases the bill can be much higher for costly high-school courses. Low-income families who qualify for free- and reduced-price lunches receive free textbooks, but it's possible that a middle-income family with several school-age children could face a textbook bill topping $500.
While it's not a dollar-for-dollar credit, the tax deduction still is a nice little gift granted to a select audience. Off the record, I was told the idea was proposed to calm some parochial school families who were angry because they wouldn't qualify for a voucher. It obviously worked, even if it's now costing the state millions in income tax revenue.