H.R. 3170 — Introduced in House

I 114th CONGRESS 1st Session H. R. 3170 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. 1. Short title This Act may be cited as the Student Debt Repayment Fairness Act. 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.