DESCRIPTION OF SECTION 201 OF H.R. 5406, 

THE “HELPING ENSURE ACCOUNTABILITY, LEADERSHIP, 

AND TRUST IN TRIBAL HEALTHCARE ACT”

Scheduled for Markup 

by the 

HOUSE COMMITTEE ON WAYS AND MEANS 

on September 14, 2016 

Prepared by the Staff 

of the 

JOINT COMMITTEE ON TAXATION 

 

 

September 13, 2016 

JCX-78-16
i 

CONTENTS 

Page 

INTRODUCTION .......................................................................................................................... 1

A. Exclusion for Assistance Provided to Participants in State Student Loan Repayment 

 Programs for Certain Health Professionals ...................................................................... 2

B. Estimated Revenue Effect ................................................................................................ 4
1 

INTRODUCTION 

The House Committee on Ways and Means has scheduled a committee markup on 

September 14, 2016, of section 201 of H.R. 5406, the “Helping Ensure Accountability, 

Leadership, and Trust in Tribal Healthcare Act.” This document,1

 prepared by the staff of the 

Joint Committee on Taxation, provides a description of section 201 of the bill. 

 1 This document may be cited as follows: Joint Committee on Taxation, Description of Section 201 of H.R. 

5406, the “Helping Ensure Accountability, Leadership, and Trust in Tribal Healthcare Act” (JCX-78-16), 

September 13, 2016. This document can also be found on the Joint Committee on Taxation website at www.jct.gov. 
2 

A. Exclusion for Assistance Provided to Participants in State Student Loan 

Repayment Programs for Certain Health Professionals 

Present Law 

Gross income generally includes the discharge of indebtedness of the taxpayer. Under an 

exception to this general rule, gross income does not include any amount from the forgiveness 

(in whole or in part) of certain student loans, provided that the forgiveness is contingent on the 

student’s working for a certain period of time in certain professions for any of a broad class of 

employers.2

Student loans eligible for this special rule must be made to an individual to assist the 

individual in attending an educational institution that normally maintains a regular faculty and 

curriculum and normally has a regularly enrolled body of students in attendance at the place 

where its education activities are regularly carried on. Loan proceeds may be used not only for 

tuition and required fees, but also to cover room and board expenses. The loan must be made by 

(1) the United States (or an instrumentality or agency thereof), (2) a State (or any political 

subdivision thereof), (3) certain tax-exempt public benefit corporations that control a State, 

county, or municipal hospital and whose employees have been deemed to be public employees 

under State law, or (4) an educational organization that originally received the funds from which 

the loan was made from the United States, a State, or a tax-exempt public benefit corporation. 

In addition, an individual’s gross income does not include amounts from the forgiveness 

of loans made by educational organizations (and certain tax-exempt organizations in the case of 

refinancing loans) out of private, nongovernmental funds if the proceeds of such loans are used 

to pay costs of attendance at an educational institution or to refinance any outstanding student 

loans (not just loans made by educational organizations) and the student is not employed by the 

lender organization. In the case of such loans made or refinanced by educational organizations 

(or refinancing loans made by certain tax-exempt organizations), cancellation of the student loan 

must be contingent upon the student working in an occupation or area with unmet needs and such 

work must be performed for, or under the direction of, a tax-exempt charitable organization or a 

governmental entity. 

Finally, an individual’s gross income does not include any loan repayment amount 

received under the National Health Service Corps loan repayment program, certain State loan 

repayment programs, or any amount received by an individual under any State loan repayment or 

loan forgiveness program that is intended to provide for the increased availability of health care 

services in underserved or health professional shortage areas (as determined by the State). 

Description of Proposal 

The proposal modifies the gross income exclusion for amounts received under the 

National Health Service Corps loan repayment program or certain State loan repayment 

 2

 Sec. 108(f). 
3 

programs to include any amount received by an individual under the Indian Health Service loan 

repayment program.3

Effective Date 

The proposal is effective for amounts received after the date of enactment. 

 

 3

 Section 108 of the Indian Health Care Improvement Act established the Indian Health Service loan 

repayment program to assure a sufficient supply of trained health professionals needed to provide health care 

services to Indians. Pub. L. No. 94-437, as amended by Pub. L. No. 100-713, sec. 108, and Pub. L. No. 102-573, 

sec. 106, and as amended, and permanently reauthorized by Pub. L. No. 111-148, sec. 10221. 
4 

B. Estimated Revenue Effect 

Fiscal Years 

[Millions of Dollars] 

2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2017-21 2017-26 

 

-7 -6 -6 -6 -6 -6 -6 -6 -7 -7 -30 -62 

NOTE: Details do not add to totals due to rounding.