What is in the GOP tax plan?

Here's how the House GOP tax plan could affect students, parents and universities

On Thursday, the GOP tax bill passed in the House of Representatives. The bill includes a $1.5 trillion corporate tax cut and eliminates many individual tax breaks which would have a major impact on students, parents and more.

The Committee for a Responsible Federal Budget and the American Council on Education estimate that the House's Tax Cuts and Jobs Actwould reduce tax benefits and savings for all college students by $65 billion over the next 10 years.

Here is a breakdown of how the bill could impact students, parents and savers:

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People with student loans

The House bill would repeal the student loan interest deduction, which allows student loan borrowers who make up to $65,000 and married couples who make up to $130,000 to lower their taxable income by $2,500. This deduction allows people with student debt to save up to $625 a year. In 2015, over 12 million borrowers deducted the interest on their student loans.

Increasing the financial burden on student loan borrowers could make student loan repayment impossible for millions of Americans.

Currently, over 44 million Americans hold a total of $1.4 trillion in student loan debt. It takes the average student debt borrower 20 yearsto pay off their loans, and over 3,000 people default on their federal student loans every day.

Parents of college students

Parents of full-time college students are often able to receive the American Opportunity Tax Credit. The American Opportunity Tax Credit is available for married couples who earn up to $160,000 and single parents who earn up to $80,000. The credit gives these families up to $2,500 annually for every child enrolled in college. Currently, families can claim this credit for four years of a child's education.

The House plan would allow parents to claim this benefit for a student's fifth year but would decrease the value of the benefit. It also would eliminate the Lifetime Opportunity Credit which allows students who attend college for more than five years to claim an annual $2,000 benefit.

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Parents saving for future college tuition payments

The proposed plan makes several changes to the ways Americans would be able to save for college.

The Tax Cuts and Jobs Act would ban people from contributing to college savings accounts called Coverdell Saving Accounts, and would convert Coverdell account into 529 plans.

Coverdell Saving Accounts allow families to deposit $2,000 per beneficiary per year. These funds can then be withdrawn tax-free if used for qualified education expenses including elementary school, secondary school and/or college. Financial planner Clint Haynes tells Time, "529 accounts can only be used for college, while the Coverdell can be used for both college and private school."

The bill also allows unborn children to be named the beneficiary of a 529 plan.

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Current graduate students

The bill would increase taxes for graduate students by roughly 400 percent. Under the House GOP tax plan, tuition waivers, which allow graduate students to attend college tuition-free in exchange for working at the university, will be taxed as income.

According to the American Council on Education, roughly 145,000 graduate students receive this kind of tuition reduction.

Legislative director of the National Association of Graduate-Professional Students Samantha Hernandez, says that this kind of tax increase would make it financially impossible to earn a Ph.D. in the United States.

"I monitor all legislation at the state and federal levels that could affect graduate and professional students, and this is just — this would have the greatest negative impact of anything I've seen," she explains to Wired. "It would be devastating."

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College faculty and staff

Many colleges offer their faculty and staff tuition benefits for their children. This allows thousands of parents, like Fred Vautour, to send their kids to college. Vautour, who works for Boston College as a nighttime janitor, was able to send his five children to college thanks to the school's tuition benefits.

"As much as I struggled, it was incredible to be able to do that for them," he told The New York Times. "I took this job for benefits, but never imagined this would be one of them."

Under the House tax plan, benefits like these would be taxed as income, dramatically increasing the taxes of workers like Vautour.

Private colleges

The House tax plan includes a 1.4 percent excise tax on college endowments at private universities valued at $100,000 or more per full-time student. Based on 2014-15 endowment values, The National Association of Independent Colleges and Universities estimates that more than 150 institutions would be affected by this proposed tax.

For instance, Wabash College which has fewer than 900 students, would pay a tax of about $350,000 per year.

"At Wabash, 40 percent of our students are first-generation college students and about one-third are eligible for federal Pell Grants based on family income. Our students' four-year graduation rate is nearly double that of their counterparts at Indiana's two largest universities,"writes Wabash President Gregory Hess. "Should the tax on private college endowments become law, Wabash will be forced to reduce scholarships, cut its workforce or reduce wages across the board. How do any of those options help middle-class families?"

What's next

Now, the Senate can amend and vote on the House's Tax Cuts and Jobs Act, or they can move forward with the current Senate tax plan.

Both the House and Senate tax plans eliminate deductions for interest on student loans. The Senate tax plan differs in that it does not includethe imposition of income taxes on tuition waivers or tuition credits and does not make the same adjustments to the American Opportunity Tax Credit.

And the future of the Tax Cuts and Jobs Act in the Senate remains uncertain. Republican Senators like Ron Johnson of Wisconsin, Susan Collins of Maine and Jeff Flake of Arizona have expressed concerns over the House's bill.

Vice President Mike Pence told the Tax Foundation, "The next few weeks are going to be vitally important and they're going to be a challenge."