H.R. 5509

College Tuition and Debt Relief Act of 2014

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I

113th CONGRESS

2d Session

H. R. 5509

IN THE HOUSE OF REPRESENTATIVES

September 17, 2014

Mr. Braley of Iowa 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 increase and extend the American Opportunity Tax Credit and to increase the student loan interest deduction.

1.

Short title

This Act may be cited as the College Tuition and Debt Relief Act of 2014.

2.

American Opportunity Tax Credit increase and extension

(a)

Credit made permanent

Section 25A(i) of the Internal Revenue Code of 1986 is amended by striking and before 2018.

(b)

Increase in credit amount

Paragraph (1) of section 25A(i) of the Internal Revenue Code of 1986 is amended—

(1)

in subparagraph (A) by striking $2,000 and inserting $2,500, and

(2)

in subparagraph (B) by striking as exceeds $2,000 but does not exceed $4,000 and inserting as exceeds $2,500 but does not exceed $4,500.

(c)

Adjustment for inflation

Section 25A(i) of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

(7)

Adjustments for inflation

In the case of a taxable year beginning after December 31, 2015, each of the dollar amounts in subparagraph (A) and (B) of paragraph (1) and clause (ii) of paragraph (4)(A) shall be increased by an amount equal to—

(A)

such dollar amount, multiplied by

(B)

the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting calendar year 2014 for calendar year 1992 in subparagraph (B) thereof.

If any amount as increased under the preceding sentence is not a multiple of $10, such amount shall be rounded to the nearest multiple of $10.

.

(d)

Effective date

The amendments made by this section shall apply to taxable years beginning after December 31, 2014.

3.

Student loan interest deduction increase

(a)

In general

Paragraph (1) of section 221(b) of the Internal Revenue Code of 1986 is amended to read as follows:

(1)

In general

Except as provided in paragraph (2), the deduction allowed by subsection (a) for the taxable year shall not exceed $5,000.

.

(b)

Adjustment for inflation

(1)

In general

Section 221(f) 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)

Adjustment for inflation

In the case of a taxable year beginning after December 31, 2015, the $5,000 dollar amount in paragraph (1) shall be increased by an amount equal to—

(A)

such dollar amount, multiplied by

(B)

the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting calendar year 2014 for calendar year 1992 in subparagraph (B) thereof.

.

(2)

Conforming amendment

Section 221(f)(3) of the Internal Revenue Code of 1986, as redesignated by paragraph (1), is amended to read as follows:

(3)

Rounding

(A)

Modified adjusted gross income thresholds

If any amount as adjusted under paragraph (1) is not a multiple of $5,000, such amount shall be rounded to the next lowest multiple of $5,000.

(B)

Deduction limitation

If any amount as increased under paragraph (2) is not a multiple of $10, such amount shall be rounded to the nearest multiple of $10.

.

(c)

Effective date

The amendments made by this section shall apply to taxable years beginning after December 31, 2014.