[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3170 Introduced in House (IH)]

114th CONGRESS
  1st Session
                                H. R. 3170

To amend the Internal Revenue Code of 1986 to allow without penalty any 
        529 plan distributions used for student loans payments.


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                    IN THE HOUSE OF REPRESENTATIVES

                             July 22, 2015

  Mr. Nugent 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 without penalty any 
        529 plan distributions used for student loans payments.

    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 Debt Repayment Fairness 
Act''.

SEC. 2. STUDENT LOAN PAYMENTS FROM QUALIFIED TUITION PLANS NOT SUBJECT 
              TO PENALTY TAX.

    (a) In General.--Section 529(c)(6) of the Internal Revenue Code of 
1986 is amended--
            (1) by inserting ``(A) In general.--'' before ``The tax'' 
        and moving the text 2 ems to the right; and
            (2) by adding at the end the following:
                    ``(B) Student loans.--
                            ``(i) In general.--Subparagraph (A) shall 
                        not apply to any payment or distribution in any 
                        taxable year which is includible in gross 
                        income and is used to pay principal or interest 
                        on indebtedness incurred solely to pay 
                        qualified higher education expenses of the 
                        designated beneficiary or member of the family 
                        of the designated beneficiary which are 
                        attributable to education furnished during a 
                        period during which the beneficiary or family 
                        member was a student at the institution 
                        providing such education.
                            ``(ii) Refinanced loans.--For purposes of 
                        clause (i), the term `indebtedness' includes 
                        indebtedness used to refinance indebtedness 
                        described in clause (i).''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to payments made in taxable years beginning after December 31, 
2014.
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