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HR5084119th CongressWALLET

Teacher Loan Forgiveness Enhancement Act

Sponsored By: Representative Fields, Cleo [D-LA-6]

Introduced

Summary

Teacher undergraduate loan forgiveness would create a federal program to cancel the remaining principal and interest on eligible undergraduate federal loans for public school teachers after they complete eight consecutive years of full-time service. It would also add a teacher-specific deferment while serving and allow limited tax return sharing to verify eligibility.

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  • Teachers: Eligible public elementary and secondary school teachers who complete 8 consecutive years of full-time service could have the remaining balance of qualifying undergraduate federal loans forgiven. Forgiven amounts would not count as taxable income.
  • Borrowers and colleges: Borrowers could combine this benefit with other federal forgiveness programs to receive multiple forms of relief. Institutions would get federal payments equal to canceled loan amounts, funded under existing Higher Education Act provisions.
  • Administration and verification: The bill would create a deferment for Direct Loans, FFEL loans, and Perkins Loans during service and for six months after, with no interest accrual during that time. It would let the Treasury share limited tax return and employer information with the Education Department to confirm employment and discharge loans.

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Bill Overview

Analyzed Economic Effects

2 provisions identified: 1 benefits, 0 costs, 1 mixed.

More loan relief for public school teachers

If enacted, public school teachers could get full forgiveness of federal undergraduate loans after eight consecutive years of full-time teaching. The remaining principal and interest would be canceled at that time, and the amount would not be taxable. Only loans from undergraduate study would qualify, and you could combine this with other federal service-based programs, including Public Service Loan Forgiveness. You could also pause payments while you teach and for six months after; for Direct Loans, interest would not accrue during the pause. The Direct Loan pause would apply to loans made on or after enactment and to those already in repayment then, and the bill would add a similar deferment for FFEL and Perkins loans.

IRS data checks for teacher forgiveness

If enacted, Treasury could share parts of your tax return with the Education Department to verify public school teaching for loan forgiveness. The Education Secretary would have to request this in writing, and only authorized people could see it. Shared items could include your employer’s ID number, employer name and type, and proof you worked there in certain years. The data would be used only to process teacher loan discharges, and would apply to disclosures made on or after enactment.

Sponsors & CoSponsors

Sponsor

Fields, Cleo [D-LA-6]

LA • D

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

No roll call votes available for this bill.

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