[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4020 Introduced in House (IH)]

113th CONGRESS
  2d Session
                                H. R. 4020

To amend the Internal Revenue Code of 1986 to allow certain discharged 
student loan debt to be included in gross income ratably over 15 years 
  and to disregard such income in determining eligibility for Federal 
                         means-tested programs.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            February 6, 2014

Ms. Pingree of Maine introduced the following bill; which was referred 
                   to the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to allow certain discharged 
student loan debt to be included in gross income ratably over 15 years 
  and to disregard such income in determining eligibility for Federal 
                         means-tested programs.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Student Loan Forgiveness Tax 
Repayment Act of 2014''.

SEC. 2. 15-YEAR RATABLE INCLUSION OF CANCELLED STUDENT LOAN DEBT.

    (a) In General.--Subchapter Q of chapter 1 of the Internal Revenue 
Code of 1986 is amended by adding at the end the following new part:

            ``PART VIII--RATABLE INCLUSION OF CERTAIN INCOME

``Sec. 1351A. 15-year ratable inclusion of cancelled student loan debt.

``SEC. 1351A. 15-YEAR RATABLE INCLUSION OF CANCELLED STUDENT LOAN DEBT.

    ``(a) In General.--In the case of any individual who elects the 
application of this section for any taxable year, any amount which (but 
for this section) would be includible in gross income for the taxable 
year by reason of the discharge (in whole or in part) of any student 
loan (as defined by section 108(f)(2)) by reason of death or disability 
shall be so included ratably over the 15-taxable-year period beginning 
with the taxable year of such discharge.
    ``(b) Limitation Based on Modified Adjusted Gross Income.--
            ``(1) In general.--The amount taken into account under 
        subsection (a) shall not exceed the amount which (but for this 
        subsection) would be so taken into account, reduced by the 
        excess (if any) of--
                    ``(A) the modified adjusted gross income of the 
                taxpayer for the taxable year of the discharge, over
                    ``(B) $80,000 ($160,000 in the case of a joint 
                return).
            ``(2) Modified adjusted gross income.--The term `modified 
        adjusted gross income' means the adjusted gross income of the 
        taxpayer for the taxable year determined--
                    ``(A) without regard to this section and sections 
                911, 931, and 933, and
                    ``(B) after the application of sections 86, 135, 
                137, 199, 219, 221, 222, and 469.
    ``(c) Special Rules.--
            ``(1) Death of student.--In the case of any discharge of a 
        student loan by reason of the death of an individual to whom 
        the loan was made, no election under this section may be made 
        by or on behalf of such individual.
            ``(2) Election.--Any election made under this section, once 
        made, shall be irrevocable.''.
    (b) Conforming Amendments.--
            (1) Sections 86(b)(2)(A), 135(c)(4)(A), 137(b)(3)(A), 
        221(b)(2)(C)(i), 222(b)(2)(C)(i) are each amended by striking 
        ``and 933'' and inserting ``933, and 1351A''.
            (2) Section 199(d)(2)(B) of such Code is amended by 
        inserting ``and section 1351A'' before the period at the end.
            (3) Section 219(g)(3)(A)(ii) is amended by striking ``and 
        911'' and inserting ``911, and 1351A''.
            (4) Section 469(i)(3)(F)(iii) of such Code is amended by 
        striking ``and 222'' and inserting ``222, and 1351A''.
    (c) Clerical Amendment.--The table of parts for subchapter Q of 
chapter 1 of such Code is amended by adding at the end the following 
new item:

          ``Part VIII. Ratable Inclusion of Certain Income''.

    (d) Effective Date.--The amendments made by this section shall 
apply to discharges of indebtedness after the date of the enactment of 
this Act.

SEC. 3. STUDENT LOAN DEBT CANCELLED BY REASON OF DEATH OR DISABILITY 
              DISREGARDED FOR FEDERAL MEAN-TESTED PROGRAMS.

    The discharge of any student loan (as defined by section 108(f)(2) 
of the Internal Revenue Code of 1986) by reason of death or disability, 
and any income attributable thereto, shall be disregarded for purposes 
of determining eligibility for any Federal means-tested program.
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