[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[S. 1757 Introduced in Senate (IS)]
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118th CONGRESS
1st Session
S. 1757
To amend the Internal Revenue Code of 1986 to exclude certain post-
graduation scholarship grants from gross income in the same manner as
qualified scholarships to promote economic growth.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
May 30, 2023
Mr. Peters (for himself and Mrs. Capito) introduced the following bill;
which was read twice and referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to exclude certain post-
graduation scholarship grants from gross income in the same manner as
qualified scholarships to promote economic growth.
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 ``Workforce Development Through Post-
Graduation Scholarships Act of 2023''.
SEC. 2. POST-GRADUATION SCHOLARSHIP GRANTS EXCLUDED FROM GROSS INCOME
IN SAME MANNER AS QUALIFIED SCHOLARSHIPS.
(a) In General.--Section 117(a) of the Internal Revenue Code of
1986 is amended--
(1) by striking the period at the end and inserting ``,
or'',
(2) by striking ``any amount received'' and inserting the
following: ``any amount which--
``(1) is received'', and
(3) by adding at the end the following new paragraph:
``(2) is received as a post-graduation scholarship grant
paid on behalf of an individual.''.
(b) Post-Graduation Scholarship Grant.--Section 117(b) of the
Internal Revenue Code of 1986 is amended by redesignating paragraph (2)
as paragraph (3) and by inserting after paragraph (1) the following new
paragraph:
``(2) Post-graduation scholarship grant.--
``(A) In general.--The term `post-graduation
scholarship grant' means any grant program--
``(i) which is established by an
organization which--
``(I) is described in section
501(c)(3) and exempt from tax under
section 501(a), and
``(II) is either a private
foundation or community trust described
in section 170(b)(1)(A)(vi) (other than
an organization established by an
organization described in section
170(b)(1)(A)(ii) or an organization
described in section 170(b)(1)(A)(iii)
the principal purpose or function of
which is the provision of medical
education),
``(ii) under which, in accordance with the
conditions of a grant, such organization repays
any portion of an applicable education loan
incurred by an individual,
``(iii) which requires a grantee to live
and work in an applicable community,
``(iv) under which payments are made
directly to the holder of the loan, and
``(v) which is not provided to an employee
of the granting organization or a related
entity of the granting organization.
``(B) Applicable education loan.--For purposes of
subparagraph (A), the term `applicable education loan'
means, with respect to any individual, a qualified
education loan (as defined in section 221(d)(1))
incurred to pay qualified higher education expenses (as
defined in section 221(d)(2)) of such individual.
``(C) Applicable community.--For purposes of
subparagraph (A), the term `applicable community' means
any area that has a bachelor's degree attainment rate
for the population that is below the state or national
average for such population (as determined based on
data collected by the Census Bureau).''.
(c) Amount Not Treated as Taxable Expenditure by Private
Foundation.--Section 4945(g) of the Internal Revenue Code of 1986 is
amended by striking ``or'' at the end of paragraph (2), by striking the
period at the end of paragraph (3) and inserting ``, or'', and by
adding at the end the following new paragraph:
``(4) the grant is a post-graduation scholarship grant (as
defined in section 117(b)(2)).''.
(d) Denial of Double Benefit.--Section 221(e) of the Internal
Revenue Code of 1986 is amended by redesignating paragraphs (2) and (3)
as paragraphs (3) and (4), respectively, and by inserting after
paragraph (1) the following new paragraph:
``(2) Denial of double benefit in case of post-graduation
scholarship grants.--Any interest which is paid as part of a
post-graduation scholarship grant and excluded from gross
income under section 117 shall not be taken into account under
this section.''.
(e) Regulatory Authority.--Section 117 of the Internal Revenue Code
of 1986 is amended by adding at the end the following new subsection:
``(e) Regulations.--The Secretary shall prescribe such reporting
requirements and regulations as may be necessary or appropriate to
carry out subsection (a)(2).''.
(f) Reports.--
(1) Secretary of treasury.--Not later than 3 years after
the date of the enactment of this Act, and periodically
thereafter, the Secretary of the Treasury, or the Secretary's
delegate, shall submit to Congress a report on the
implementation and effectiveness of the amendments made by this
section.
(2) Comptroller general.--
(A) In general.--Not later than 5 years after the
date of enactment of this Act, the Comptroller General
of the United States shall publish the result of a
study on post-graduation scholarship grants to which
section 117 of the Internal Revenue Code of 1986 (as
amended by this section) applies.
(B) Contents of report.--The information published
under subparagraph (A) shall include the following:
(i) The length of time involved in such
grants.
(ii) The amount paid out under such grants.
(iii) The disposition of any funds paid
under such grants, including the identity of
any loan holders who benefit from such funds.
(g) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after the date of the enactment of
this Act.
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