S. 1047

Generating Opportunity by Forgiving Educational Debt for Service Act of 2007

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II

110th CONGRESS

1st Session

S. 1047

IN THE SENATE OF THE UNITED STATES

March 29, 2007

Mr. Voinovich (for himself, Ms. Collins, and Mr. Akaka) 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 from gross income amounts paid on behalf of Federal employees and members of the Armed Forces on active duty under Federal student loan repayment programs.

1.

Short title

This Act may be cited as the Generating Opportunity by Forgiving Educational Debt for Service Act of 2007.

2.

Exclusion for student loan repayments by the Federal Government

(a)

Exclusion from gross income

Section 108(f) of the Internal Revenue Code of 1986 (relating to student loans) is amended by adding at the end the following:

(5)

Student loan repayments by Federal Government

In the case of an individual, gross income does not include any payments made by the Federal Government on behalf of such individual under—

(A)
(i)

section 5379 of title 5, United States Code; or

(ii)

any other similar Federal program for its employees; or

(B)

section 510(e)(2), chapter 109, or chapter 1609 of title 10, United States Code.

.

(b)

Exclusion from wages

(1)

In general

Section 3121(a) of such Code (defining wages) is amended—

(A)

in paragraph (21), by striking or at the end;

(B)

in paragraph (22), by striking the period at the end and inserting ; or; and

(C)

by inserting after paragraph (22) the following:

(23)

any payment excluded from gross income under section 108(f)(5) (relating to student loan repayments by the Federal Government).

.

(2)

Social Security Act

Section 209(a) of the Social Security Act (42 U.S.C. 409(a)) is amended by adding at the end the following:

(20)

Any payment excluded from gross income under section 108(f)(5) of the Internal Revenue Code of 1986 (relating to student loan repayments by Federal Government).

.

(c)

Effective date

The amendments made by this section shall apply to payments made on or after the date of enactment of this Act in taxable years ending after such date.