Tuition and related expenses for college continue to rise. In 2004-2005, the average private four year college tuition was $ $30,295 a year. The average public university was $14,640 a year. Community colleges offer a lower priced option for the first two years of college but eventually anyone wanting to obtain a bachelor degree will likely face a substantial tuition bill.

Set against this backdrop, there have been recent changes in the federal formula used to calculate eligibility for federal assistance that made it more difficult to obtain assistance:

• The amount students receive is mostly based on an intricate formula administered by the Department of Education, that looks at many aspects of a family's circumstances, including its income, its tax bill, its investments, its size and even parents ages.(9)

• The Department of Education says that any changes to the formula are driven by a legal obligation to keep it current, reflecting what families can truly afford to pay. For example, the administration determined that more of a parent's assets must be counted toward college expenses this year because it predicted better economic circumstances.(9)

"[T]ens of thousands of low-income students will no longer be eligible for federal grants; middle-class families are digging deeper into their savings; and some colleges are putting up their own money to make up the difference. [...] The Times found that families with the same earnings and assets as in 2000 would typically have to pay an extra $1,749 before clearing the eligibility bar for financial aid in 2005, after adjusting for inflation." (9)

Keeping all this in perspective, the College Board also has noted the following:

• About 62 percent of all full-time college students receive grant aid. In 2005-2006, aid in the form of grants and tax benefits averaged about $2,200 per student at two-year public colleges, over $3,100 at public four-year colleges, and about $9,000 per student at private four-year colleges.
• Fifty-six percent of full-time students enrolled in public four-year colleges and universities attend institutions that charge published in-state tuition and fees between $3,000 and $6,000.
• While private four-year institutions have a much wider range of tuition and fee charges, only about 5 percent of all students attend colleges with tuition and fees totaling $33,000 or higher per year.

Some institutions are developing their own solutions for higher education expenses. Yale University recently established that parents who earn less than $45,000 a year do not have to pay anything towards their child education. (10) "Harvard announced a similar program last year, freeing parents who earn $40,000 or less from paying anything and Princeton does not require loans for low income students." (10) Still, most institutions do not have the assets to undertake such programs.

Making more higher education expenses tax deductible is one proposal to alleviate some of the burden of higher education costs. Such an idea is not new to the U.S. Tax code. In fact, education expenses are already tax deductible if, among other things, the taxpayer is already engaged in a related trade or business. Also, there is currently a $3,000 tuition tax deduction per year per family already in place. Senator Joe Biden of Delaware has proposed the Tuition Assistance for Families Act, which, among other things, would raise the tuition tax deduction to $12,000 per year, per family.