On this page, you'll find proposals that modify the existing tax code in areas relating to student financial aid.
Sponsor: Rep. Stivers [R-OH]
NASFAA Summary & Analysis: This bill would amend the IRS Code of 1986 to allow employers to contribute up to $10,000 per year to their employee’s student loans as a non-taxable benefit, the current limit is $5,250. The bill would also remove the current $2,500 cap on deductions for student loan interest and allow all interest to be deducted on loan amounts up to $85,000 for single borrowers, and $115,000 for married borrowers.
Sponsor: Rep. Rice [D-NY]
NASFAA Summary & Analysis: This bill would allow all student loan interest to be deducted on loan amounts up to $750,000 as well as eliminates the current income limits on who can claim student loan interest deductions, allowing all individuals to take advantage of the deductions. The bill also allows parent PLUS loan borrowers a twelve month grace period after their student graduates until they need to begin making payments on their loans.
Sponsor: Sen. Klobuchar [D-MN]
Cosponsors: 1 (0D; 1R)
NASFAA Summary & Analysis: This bill would update the name of Coverdell Education Savings Accounts to Coverdell Lifelong Learning Accounts, which would be retroactive for accounts already in existence. The bill would also add "qualified educational or skill development expenses" to the list of qualified uses of the funds kept in a Coverdell account, allowing owners of these accounts to use their funds towards, training services, career and technical education activities, youth workforce investment activities, adult education and literacy activities, expenses for transportation required for or provided by any of these services or activities, as well as expenses for testing necessary for enrollment in, or certification in connection with these services or activities.
Publication Date: 3/24/2021