Can you tell me how Cornell follows 117 a-c while so many other institutions obviously follow 117d?

Date: December 2017


Dear Ask a Dean,

According to the Cornell Daily Sun’s coverage of last Monday’s GPSA meeting, Cornell graduate students would not be impacted by changes in the tax plan in the event it passes the senate because Cornell follows sections 117 a-c while the proposed tax plan would repeal 117d. This is certainly a relief for Cornell students, but in an effort to understand how this would broadly impact higher education and our graduate colleagues at other institutions, can you tell me how Cornell follows 117 a-c while so many other institutions obviously follow 117d? Why are Cornell students exempt?

Thank you,

Concerned grad student


Dear Concerned Grad Student,

Thank you for your Ask a Dean question. As explained in earlier Graduate Announcements, there are two tax reform bills moving through the US Congress legislative process. The House bill would repeal Section 117(d) of the tax code, but the Senate bill would leave that provision intact. Neither bill changes the current Section 117(a-c) of the tax code. Cornell Government Affairs and other senior university leaders are continuing to express concerns to legislators about the possible repeal of 117(d), urging them to leave the current Section intact.

Section 117(a-c) treats tuition provided through qualified scholarships as non-taxable benefits. Section 117(d) treats qualified tuition reductions as non-taxable benefits. As reported in earlier Graduate Announcements and Ask a Dean columns, as advised by Cornell’s tax counsel, because Cornell pays graduate students reasonable compensation for teaching, research, or other services they provide to the university, Cornell graduate students receiving a tuition scholarship are receiving a qualified scholarship as students under 117(a-c) of the current tax code, not a tuition reduction as under 117(d). 

Repeal of 117(d), however, would have serious, negative consequences for graduate education nationally because some colleges and universities rely on 117(d) for non-taxable tuition reductions for graduate students. Cornell benefits from having a strong system of graduate education nationally, and strongly supports the continuation of Section 117(d). 

Warm regards,


Barbara A. Knuth
Senior Vice Provost and Dean of the Graduate School