[Congressional Bills 117th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5152 Introduced in House (IH)]
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117th CONGRESS
1st Session
H. R. 5152
To amend the Internal Revenue Code of 1986 to provide for a phaseout of
the investment income excise tax for certain private colleges and
universities, and for other purposes.
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IN THE HOUSE OF REPRESENTATIVES
September 3, 2021
Mr. Brendan F. Boyle of Pennsylvania introduced the following bill;
which was referred to the Committee on Ways and Means
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A BILL
To amend the Internal Revenue Code of 1986 to provide for a phaseout of
the investment income excise tax for certain private colleges and
universities, 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 ``Higher Education Endowment Tax
Reform Act''.
SEC. 2. PHASEOUT OF INVESTMENT INCOME EXCISE TAX FOR PRIVATE COLLEGES
AND UNIVERSITIES PROVIDING SUFFICIENT GRANTS AND
SCHOLARSHIPS.
(a) In General.--Section 4968 of the Internal Revenue Code of 1986
is amended by adding at the end the following new subsection:
``(e) Phaseout for Institutions Providing Qualified Aid.--
``(1) In general.--The amount of tax imposed by subsection
(a) (determined without regard to this subsection) shall be
reduced (but not below zero) by the amount which bears the same
ratio to such amount of tax (as so determined) as--
``(A) the excess (if any) of--
``(i) the aggregate amount of qualified aid
awards provided by the institution to its
first-time, full-time undergraduate students
for academic periods beginning during the
taxable year, over
``(ii) an amount equal to 20 percent of the
aggregate undergraduate tuition and fees
received by the institution from first-time,
full-time undergraduate students for such
academic periods, bears to
``(B) an amount equal to 13 percent of such
aggregate undergraduate tuition and fees so received.
``(2) Institution must meet reporting requirement.--
``(A) In general.--Paragraph (1) shall not apply to
an applicable educational institution for a taxable
year unless such institution furnishes to the
Secretary, and makes widely available, a statement
detailing the average aggregate amount of Federal
student loans received by a student for attendance at
the institution, averaged among each of the following
groups of first-time, full-time undergraduate students
who during the taxable year completed a course of study
for which the institution awarded a baccalaureate
degree:
``(i) All such students.
``(ii) The students who have been awarded a
Federal Pell Grant under subpart 1 of part A of
title IV of the Higher Education Act of 1965
for attendance at the institution.
``(iii) The students who received work-
study assistance under part C of title IV of
such Act for attendance at such institution.
``(iv) The students who were provided such
Federal student loans.
``(B) Form and manner for report.--Such statement
shall be furnished at such time and in such form and
manner, and made widely available, under such
regulations or guidance as the Secretary may prescribe.
``(C) Federal student loans.--For purposes of this
paragraph, the term `Federal student loans' means a
loan made under part D of title IV of the Higher
Education Act of 1965, except such term does not
include a Federal Direct PLUS Loan made on behalf of a
dependent student.
``(3) Other definitions.--For purposes of this subsection--
``(A) First-time, full-time undergraduate
student.--The term `first-time, full-time undergraduate
student' shall have the same meaning as when used in
section 132 of the Higher Education Act of 1965.
``(B) Qualified aid awards.--The term `qualified
aid awards' means, with respect to any applicable
educational institution, grants and scholarships to the
extent used for undergraduate tuition and fees.
``(C) Undergraduate tuition and fees.--The term
`undergraduate tuition and fees' means, with respect to
any institution, the tuition and fees required for the
enrollment or attendance of a student as an
undergraduate student at the institution.''.
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after . . ..
SEC. 3. INFLATION ADJUSTMENT AND CLARIFICATION FOR DEFINITION OF
APPLICABLE EDUCATIONAL INSTITUTION.
(a) Inflation Adjustment to Per Student Asset Threshold.--Section
4968(b) of the Internal Revenue Code of 1986 is amended by adding at
the end the following new paragraph:
``(3) Inflation adjustment.--In the case of any taxable
year beginning after 2022, the dollar amount in paragraph
(1)(D) 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 2021' for `calendar year 2016' in
subparagraph (A)(ii) thereof.
If any increase determined under this paragraph is not a
multiple of $1,000, such increase shall be rounded to the
nearest multiple of $1,000.''.
(b) Clarification of 500 Student Threshold.--Section 4968(b)(1)(A)
of such Code is amended by inserting ``below the graduate level'' after
``500 tuition-paying students''.
(c) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after December 31, 2021.
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