Faster Access to Federal Student Aid Act of 2019
This bill directs the Internal Revenue Service (IRS), upon the written request of the Department of Education, to disclose to any authorized person, tax return information to determine eligibility for recertifications for income-contingent or income-based repayments, discharges of loans based on total and permanent disability, and the amount of student financial aid.
The IRS must also establish and implement procedures for recertifying income for purposes of this bill and for requesting tax return information.
[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5368 Introduced in House (IH)]
<DOC>
116th CONGRESS
1st Session
H. R. 5368
To provide for secure disclosure of tax-return information to carry out
the Higher Education Act of 1965, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
December 9, 2019
Ms. DelBene introduced the following bill; which was referred to the
Committee on Education and Labor, and in addition to the Committee on
Ways and Means, for a period to be subsequently determined by the
Speaker, in each case for consideration of such provisions as fall
within the jurisdiction of the committee concerned
_______________________________________________________________________
A BILL
To provide for secure disclosure of tax-return information to carry out
the Higher Education Act of 1965, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Faster Access to Federal Student Aid
Act of 2019''.
SEC. 2. SECURE DISCLOSURE OF TAX-RETURN INFORMATION TO CARRY OUT THE
HIGHER EDUCATION ACT OF 1965.
(a) In General.--Paragraph (13) of section 6103(l) of the Internal
Revenue Code of 1986 is amended to read as follows:
``(13) Disclosure of return information to carry out the
higher education act of 1965.--
``(A) Applications and recertifications for income-
contingent or income-based repayment.--The Secretary
shall, upon written request from the Secretary of
Education, disclose to any authorized person, only for
the purpose of (and to the extent necessary in)
determining eligibility for, or repayment obligations
under, income-contingent or income-based repayment
plans under title IV of the Higher Education Act of
1965 with respect to loans under part D of such title,
the following return information from returns (for any
taxable year specified by the Secretary of Education as
relevant to such purpose) of an individual certified by
the Secretary of Education as having provided approval
under section 494(a)(2) of such Act (as in effect on
the date of enactment of this paragraph) for such
disclosure:
``(i) Taxpayer identity information.
``(ii) Filing status.
``(iii) Adjusted gross income.
``(iv) Total number of exemptions claimed,
if applicable.
``(v) Number of dependents taken into
account in determining the credit allowed under
section 24.
``(vi) If applicable, the fact that there
was no return filed.
``(B) Discharge of loan based on total and
permanent disability.--The Secretary shall, upon
written request from the Secretary of Education,
disclose to any authorized person, only for the purpose
of (and to the extent necessary in) monitoring and
reinstating loans under title IV of the Higher
Education Act of 1965 that were discharged based on a
total and permanent disability (within the meaning of
section 437(a) of such Act), the following return
information from returns (for any taxable year
specified by the Secretary of Education as relevant to
such purpose) of an individual certified by the
Secretary of Education as having provided approval
under section 494(a)(3) of such Act (as in effect on
the date of enactment of this paragraph) for such
disclosure:
``(i) The return information described in
clauses (i), (ii), and (vi) of subparagraph
(A).
``(ii) The return information described in
subparagraph (C)(ii).
``(C) Federal student financial aid.--The Secretary
shall, upon written request from the Secretary of
Education, disclose to any authorized person, only for
the purpose of (and to the extent necessary in)
determining eligibility for, and amount of, Federal
student financial aid under a program authorized under
subpart 1 of part A, part C, or part D of title IV of
the Higher Education Act of 1965 the following return
information from returns (for the taxable year used for
purposes of section 480(a) of such Act) of an
individual certified by the Secretary of Education as
having provided approval under section 494(a)(1) of
such Act (as in effect on the date of enactment of this
paragraph) for such disclosure:
``(i) Return information described in
clauses (i) through (vi) of subparagraph (A).
``(ii) The amount of any net earnings from
self-employment (as defined in section
1402(a)), wages (as defined in section 3121(a)
or 3401(a)), and taxable income from a farming
business (as defined in section 236A(e)(4)).
``(iii) Amount of total income tax.
``(iv) Amount of any credit allowed under
section 25A.
``(v) Amount of individual retirement
account distributions not included in adjusted
gross income.
``(vi) Amount of individual retirement
account contributions and payments to self-
employed SEP, Keogh, and other qualified plans
which were deducted from income.
``(vii) Amount of tax-exempt interest
received.
``(viii) Amounts from retirement pensions
and annuities not included in adjusted gross
income.
``(ix) If applicable, the fact that any of
the following schedules (or equivalent
successor schedules) were filed with the
return:
``(I) Schedule A.
``(II) Schedule B.
``(III) Schedule D.
``(IV) Schedule E.
``(V) Schedule F.
``(VI) Schedule H.
``(x) If applicable, the amount reported on
Schedule C (or an equivalent successor
schedule) as net profit or loss.
``(D) Additional uses of disclosed information.--
``(i) In general.--In addition to the
purposes for which information is disclosed
under subparagraphs (A), (B), and (C), return
information so disclosed may be used by an
authorized person, with respect to income-
contingent or income-based repayment plans,
awards of Federal student financial aid under a
program authorized under subpart 1 of part A,
part C, or part D of title IV of the Higher
Education Act of 1965, and discharges of loans
based on a total and permanent disability
(within the meaning of section 437(a) of such
Act), for purposes of--
``(I) reducing the net cost of
improper payments under such plans,
relating to such disbursements, or
relating to such discharges,
``(II) oversight activities by the
Office of Inspector General of the
Department of Education as authorized
by the Inspector General Act of 1978,
and
``(III) conducting analyses and
forecasts for estimating costs related
to such plans, disbursements, or
discharges.
``(ii) Limitation.--The purposes described
in clause (i) shall not include the conduct of
criminal investigations or prosecutions.
``(iii) Redisclosure to institutions of
higher education, state higher education
agencies, and designated scholarship
organizations.--Authorized persons may
redisclose return information received under
subparagraph (C), solely for the use in the
application, award, and administration of
financial aid awarded by the Federal Government
or awarded by a person described in subclause
(I), (II), or (III), to the following persons:
``(I) An institution of higher
education participating in a program
under subpart 1 of part A, part C, or
part D of title IV of the Higher
Education Act of 1965.
``(II) A State higher education
agency.
``(III) A scholarship organization
which is an entity designated (prior to
the date of the enactment of this
clause) by the Secretary of Education
under section 483(a)(3)(E) of such Act.
This clause shall only apply to the extent that
the taxpayer with respect to whom the return
information relates provides written consent
for such redisclosure to the Secretary of
Education.
``(E) Authorized person.--For purposes of this
paragraph, the term `authorized person' means, with
respect to information disclosed under subparagraph
(A), (B), or (C), any person who--
``(i) is an officer, employee, or
contractor, of the Department of Education, and
``(ii) is specifically authorized and
designated by the Secretary of Education for
purposes of such subparagraph (applied
separately with respect to each such
subparagraph).
``(F) Joint returns.--In the case of a joint
return, any disclosure authorized under subparagraph
(A), (B), or (C) with respect to an individual shall be
treated for purposes of this paragraph as applying with
respect to the taxpayer.''.
(b) Confidentiality of Return Information.--Section 6103(a)(3) of
such Code is amended by inserting ``, (13)'' after ``(12)''.
(c) Conforming Amendments.--
(1) Section 6103(p)(3)(A) of such Code is amended by
striking ``(13)''.
(2) Section 6103(p)(4) of such Code is amended by inserting
``, (13)'' after ``(l)(10)'' each place it appears.
(d) Effective Date.--The amendments made by this section shall
apply to disclosures made after the Secretary of the Treasury (or the
Secretary's designee) submits a written notification to the Committee
on Ways and Means of the House of Representatives and the Committee on
Finance of the Senate that the Secretary of Education has demonstrated
a readiness to comply with the standards outlined in Internal Revenue
Service Publication 1075 with respect to return information received
under section 6103(l)(13) of the Internal Revenue Code of 1986.
(e) Requirement To Designate the Inspector General of the
Department of Education as an Authorized Person.--The Secretary of
Education shall authorize and designate the Inspector General of the
Department of Education as an authorized person under subparagraph
(E)(ii) of section 6103(l)(13) of the Internal Revenue Code of 1986 for
purposes of subparagraphs (A), (B), and (C) of such section.
(f) Report to Treasury.--The Secretary of Education shall annually
submit a written report to the Secretary of the Treasury--
(1) regarding redisclosures of return information under
subparagraph (D)(iii) of section 6103(l)(13) of the Internal
Revenue Code of 1986, including the number of such
redisclosures; and
(2) regarding any unauthorized use, access, or disclosure
of return information disclosed under such section.
(g) Report to Congress.--The Secretary of the Treasury (or the
Secretary's designee) shall annually submit a written report to
Congress regarding disclosures under section 6103(l)(13) of the
Internal Revenue Code of 1986, including information provided to the
Secretary under subsection (f).
SEC. 3. AUTOMATIC RECERTIFICATION OF INCOME.
(a) Income-Contingent Repayment.--
(1) In general.--Section 455(e) of the Higher Education Act
of 1965 (20 U.S.C. 1087e(e)) is amended by adding at the end
the following:
``(8) Automatic recertification.--
``(A) In general.--The Secretary shall establish
and implement, with respect to any borrower described
in subparagraph (B), procedures to--
``(i) use return information disclosed
under section 6103(l)(13) of the Internal
Revenue Code of 1986, pursuant to approval
provided under section 494, to determine the
repayment obligation of the borrower without
further action by the borrower;
``(ii) allow the borrower (or the spouse of
the borrower), at any time, to opt out of
disclosure under such section 6103(l)(13) and
instead provide such information as the
Secretary may require to determine the
repayment obligation of the borrower (or
withdraw from the repayment plan under this
subsection); and
``(iii) provide the borrower with an
opportunity to update the return information so
disclosed before the determination of the
repayment obligation of the borrower.
``(B) Applicability.--Subparagraph (A) shall apply
to each borrower of a loan made under this part who, on
or after the date on which the Secretary establishes
procedures under such subparagraph--
``(i) selects, or is required to repay such
loan pursuant to, an income-contingent
repayment plan; or
``(ii) recertifies income or family size
under such plan.''.
(2) Conforming amendment.--Section 455(e)(6) of the Higher
Education Act of 1965 (20 U.S.C. 1087e(e)(6)) is amended--
(A) by striking ``including notification of such
borrower'' and all that follows through ``that if a
borrower'' and inserting ``including notification of
such borrower, that if a borrower''; and
(B) by striking ``as determined using the
information described in subparagraph (A), or the
alternative documentation described in paragraph (3)''.
(b) Income-Based Repayment.--Section 493C(c) of the Higher
Education Act of 1965 (20 U.S.C. 1098e(c)) is amended--
(1) by striking ``The Secretary shall establish'' and
inserting the following:
``(1) In general.--The Secretary shall establish''; and
(2) by striking ``The Secretary shall consider'' and
inserting the following:
``(2) Procedures for eligibility.--The Secretary shall--
``(A) consider'';
(3) by striking ``428C(b)(1)(E).'' and inserting the
following: ``428C(b)(1)(E); and
``(B) carry out, with respect to borrowers of any
loan made under part D (other than an excepted PLUS
loan or excepted consolidation loan), procedures for
income-based repayment plans that are equivalent to the
procedures carried out under section 455(e)(8) with
respect to income-contingent repayment plans.''.
SEC. 4. AUTOMATIC INCOME MONITORING PROCEDURES AFTER A TOTAL AND
PERMANENT DISABILITY DISCHARGE.
Section 437(a) of the Higher Education Act of 1965 (20 U.S.C.
1087(a)) is amended by adding at the end the following:
``(3) Automatic income monitoring.--
``(A) In general.--The Secretary shall establish
and implement, with respect to any borrower described
in subparagraph (B), procedures to--
``(i) use return information disclosed
under section 6103(l)(13) of the Internal
Revenue Code of 1986, pursuant to approval
provided under section 494, to determine the
borrower's continued eligibility for the loan
discharge described in subparagraph (B);
``(ii) allow the borrower, at any time, to
opt out of disclosure under such section
6103(l)(13) and instead provide such
information as the Secretary may require to
determine the borrower's continued eligibility
for such loan discharge; and
``(iii) provide the borrower with an
opportunity to update the return information so
disclosed before determination of such
borrower's continued eligibility for such loan
discharge.
``(B) Applicability.--Subparagraph (A) shall
apply--
``(i) to each borrower of a loan that is
discharged due to the total and permanent
disability (within the meaning of this
subsection) of the borrower; and
``(ii) during the period beginning on the
date on which such loan is so discharged and
ending on the first day on which such loan may
no longer be reinstated.''.
SEC. 5. PROCEDURE AND REQUIREMENTS FOR REQUESTING TAX RETURN
INFORMATION FROM THE INTERNAL REVENUE SERVICE.
(a) In General.--Part G of title IV of the Higher Education Act of
1965 (20 U.S.C. 1088 et seq.) is amended by adding at the end the
following:
``SEC. 494. PROCEDURE AND REQUIREMENTS FOR REQUESTING TAX RETURN
INFORMATION FROM THE INTERNAL REVENUE SERVICE.
``(a) Notification and Approval Requirements.--
``(1) Federal student financial aid.--In the case of any
written or electronic application under section 483 by an
individual for Federal student financial aid under a program
authorized under subpart 1 of part A, part C, or part D, the
Secretary, with respect to such individual and any parent or
spouse whose financial information is required to be provided
on such application, shall--
``(A) notify such individuals that--
``(i) if such individuals provide approval
under subparagraph (B), the Secretary will have
the authority to request that the Secretary of
the Treasury disclose return information of
such individuals to authorized persons (as
defined in section 6103(l)(13) of the Internal
Revenue Code of 1986) for the relevant purposes
described in such section; and
``(ii) the failure to provide such approval
for such disclosure will result in the
Secretary being unable to calculate eligibility
for such aid to such individual; and
``(B) require, as a condition of eligibility for
such aid, that such individuals affirmatively approve
the disclosure described in subparagraph (A)(i).
``(2) Income-contingent and income-based repayment.--
``(A) New applicants.--In the case of any written
or electronic application by an individual for an
income-contingent or income-based repayment plan for a
loan under part D, the Secretary, with respect to such
individual and any spouse of such individual, shall--
``(i) provide to such individuals the
notification described in paragraph (1)(A)(i);
``(ii) require, as a condition of
eligibility for such repayment plan, that such
individuals--
``(I) affirmatively approve the
disclosure described in paragraph
(1)(A)(i) and agree that such approval
shall serve as an ongoing approval of
such disclosure until the date on which
the individual elects to opt out of
such disclosure under section 455(e)(8)
or the equivalent procedures
established under section
493C(c)(2)(B), as applicable; or
``(II) provide such information as
the Secretary may require to confirm
the eligibility of such individual for
such repayment plan.
``(B) Recertifications.--With respect to the first
written or electronic recertification (after the date
of the enactment of the Faster Access to Federal
Student Aid Act of 2019) of an individual's income or
family size for purposes of an income-contingent or
income-based repayment plan (entered into before the
date of the enactment of the Faster Access to Federal
Student Aid Act of 2019) for a loan under part D, the
Secretary, with respect to such individual and any
spouse of such individual, shall meet the requirements
of clauses (i) and (ii) of subparagraph (A) with
respect to such recertification.
``(3) Total and permanent disability.--In the case of any
written or electronic application by an individual for a
discharge of a loan under this title based on total and
permanent disability (within the meaning of section 437(a))
that requires income monitoring, the Secretary shall--
``(A) provide to such individual the notification
described in paragraph (1)(A)(i); and
``(B) require, as a condition of eligibility for
such discharge, that such individual--
``(i) affirmatively approve the disclosure
described in paragraph (1)(A)(i) and agree that
such approval shall serve as an ongoing
approval of such disclosure until the earlier
of--
``(I) the date on which the
individual elects to opt out of such
disclosure under section 437(a)(3)(A);
or
``(II) the first day on which such
loan may no longer be reinstated; or
``(ii) provide such information as the
Secretary may require to confirm the
eligibility of such individual for such
discharge.
``(b) Limit on Authority.--The Secretary shall only have authority
to request that the Secretary of the Treasury disclose return
information under section 6103(l)(13) of the Internal Revenue Code of
1986 with respect to an individual if the Secretary of Education has
obtained approval under subsection (a) for such disclosure.''.
(b) Conforming Amendment.--Section 484(q) of the Higher Education
Act of 1965 (20 U.S.C. 1091(q)) is repealed.
SEC. 6. REPORTS ON IMPLEMENTATION.
(a) In General.--Not later than each specified date, the Secretary
of Education and the Secretary of the Treasury shall issue joint
reports to the Committees on Health, Education, Labor, and Pensions and
Finance of the Senate and the Committees on Education and Labor and
Ways and Means of the House of Representatives regarding the amendments
made by this Act. Each such report shall include, as applicable--
(1) an update on the status of implementation of the
amendments made by this Act;
(2) an evaluation of how such implementation had affected
the processing of applications for Federal student financial
aid, applications for income-based repayment and income-
contingent repayment, and applications for discharge of loans
under title IV of the Higher Education Act of 1965 (20 U.S.C.
1070 et seq.) based on total and permanent disability; and
(3) implementation issues and suggestions for potential
improvements.
(b) Specified Date.--For purposes of subsection (a), the term
``specified date'' means--
(1) the date that is 90 days after the date of the
enactment of this Act;
(2) the date that is 120 days after the first day that the
disclosure process established under section 6103(l)(13) of the
Internal Revenue Code of 1986, as amended by section 3(a) of
this Act, is operational and accessible to officers, employees,
and contractors of the Department of Education (as specifically
authorized and designated by the Secretary of Education); and
(3) the date that is 1 year after the report date described
in paragraph (2).
<all>
Introduced in House
Introduced in House
Referred to the Committee on Education and Labor, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Referred to the Committee on Education and Labor, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
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