I 

111TH CONGRESS 

1ST SESSION H. R. 1957 

To amend the Internal Revenue Code of 1986 to provide a higher education 

tuition credit in place of existing education tax incentives. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 2, 2009 

Mr. PETERS 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 provide 

a higher education tuition credit in place of existing 

education tax incentives. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Helping Families Af5 ford Tuition Act’’. 

6 SEC. 2. HIGHER EDUCATION TUITION CREDIT. 

7 (a) IN GENERAL.—Section 25A of the Internal Rev8 enue Code of 1986 (relating to Hope and Lifetime Learn9 ing credits) is amended to read as follows: 


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1 ‘‘SEC. 25A. HIGHER EDUCATION TUITION CREDIT. 

2 ‘‘(a) ALLOWANCE OF CREDIT.—In the case of any 

3 eligible student for whom an election is in effect under 

4 this section for any taxable year, there shall be allowed 

5 as a credit against the tax imposed by this chapter for 

6 the taxable year in an amount equal to 50 percent of so 

7 much of the qualified tuition and related expenses paid 

8 by the taxpayer during the taxable year (for education fur9 nished to the eligible student during any academic period 

10 beginning in such taxable year) as does not exceed 

11 $10,000. 

12 ‘‘(b) LIMITATIONS.— 

13 ‘‘(1) LIMITATION BASED ON MODIFIED AD14 JUSTED GROSS INCOME.— 

15 ‘‘(A) IN GENERAL.—The amount which 

16 would (but for this paragraph) be taken into ac17 count under subsection (a) for the taxable year 

18 shall be reduced (but not below zero) by the 

19 amount determined under subparagraph (B). 

20 ‘‘(B) AMOUNT OF REDUCTION.—The 

21 amount determined under this subparagraph is 

22 the amount which bears the same ratio to the 

23 amount which would be so taken into account 

24 as— 

25 ‘‘(i) the excess of— 


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1 ‘‘(I) the taxpayer’s modified ad2 justed gross income for such taxable 

3 year, over 

4 ‘‘(II) $100,000 ($200,000 in the 

5 case of a joint return), bears to 

6 ‘‘(ii) $10,000 ($20,000 in the case of 

7 a joint return). 

8 ‘‘(C) MODIFIED ADJUSTED GROSS IN9 COME.—The term ‘modified adjusted gross in10 come’ means the adjusted gross income of the 

11 taxpayer for the taxable year increased by any 

12 amount excluded from gross income under sec13 tion 911, 931, or 933. 

14 ‘‘(2) OTHER LIMITATIONS.— 

15 ‘‘(A) CREDIT ALLOWED ONLY FOR 5 TAX16 ABLE YEARS.—An election to have this section 

17 apply with respect to any eligible student may 

18 not be made for any taxable year if such an 

19 election (by the taxpayer or any other indi20 vidual) is in effect with respect to such student 

21 for any 5 prior taxable years. 

22 ‘‘(B) CREDIT ALLOWED FOR YEAR ONLY IF

23 INDIVIDUAL IS AT LEAST 1/2 TIME STUDENT

24 FOR PORTION OF YEAR.—The credit under sub25 section (a) shall not be allowed for a taxable 


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1 year with respect to the qualified tuition and re2 lated expenses of an individual unless such indi3 vidual is an eligible student for at least one aca4 demic period which begins during such year. 

5 ‘‘(C) CREDIT ALLOWED ONLY FOR FIRST 5

6 YEARS OF POST SECONDARY EDUCATION.—An 

7 election to have this section apply with respect 

8 to any eligible student may not be made for any 

9 taxable year if the student has completed (be10 fore the beginning of such taxable year) 5 years 

11 of post secondary education at one or more eli12 gible educational institutions. 

13 ‘‘(D) DENIAL OF CREDIT IF STUDENT

14 CONVICTED OF A FELONY DRUG OFFENSE.— 

15 The credit under subsection (a) shall not be al16 lowed for qualified tuition and related expenses 

17 for the enrollment or attendance of a student 

18 for any academic period if such student has 

19 been convicted of a Federal or State felony of20 fense consisting of the possession or distribu21 tion of a controlled substance before the end of 

22 the taxable year with or within which such pe23 riod ends. 

24 ‘‘(c) DEFINITIONS.—For purposes of this sub25 section— 


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1 ‘‘(1) ELIGIBLE STUDENT.—The term ‘eligible 

2 student’ means, with respect to any academic period, 

3 a student who— 

4 ‘‘(A) meets the requirements of section 

5 484(a)(1) of the Higher Education Act of 1965 

6 (20 U.S.C. 1091(a)(1)), as in effect on the date 

7 of the enactment of the Taxpayer Relief Act of 

8 1997, and 

‘‘(B) is carrying at least 1 9 ⁄2 the normal 

10 full-time work load for the course of study the 

11 student is pursuing. 

12 ‘‘(2) QUALIFIED TUITION AND RELATED EX13 PENSES.— 

14 ‘‘(A) IN GENERAL.—The term ‘qualified 

15 tuition and related expenses’ means tuition and 

16 fees required for the enrollment or attendance 

17 of an eligible student who is— 

18 ‘‘(i) the taxpayer, 

19 ‘‘(ii) the taxpayer’s spouse, or 

20 ‘‘(iii) any dependent of the taxpayer 

21 with respect to whom the taxpayer is al22 lowed a deduction under section 151, 

23 at an eligible educational institution for courses 

24 of instruction of such individual at such institu25 tion. 


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1 ‘‘(B) EXCEPTION FOR EDUCATION INVOLV2 ING SPORTS, ETC.—Such term does not include 

3 expenses with respect to any course or other 

4 education involving sports, games, or hobbies, 

5 unless such course or other education is part of 

6 the individual’s degree program. 

7 ‘‘(C) EXCEPTION FOR NONACADEMIC

8 FEES.—Such term does not include student ac9 tivity fees, athletic fees, insurance expenses, or 

10 other expenses unrelated to an individual’s aca11 demic course of instruction. 

12 ‘‘(3) ELIGIBLE EDUCATIONAL INSTITUTION.— 

13 The term ‘eligible educational institution’ means an 

14 institution— 

15 ‘‘(A) which is described in section 481 of 

16 the Higher Education Act of 1965 (20 U.S.C. 

17 1088), as in effect on the date of the enactment 

18 of the Taxpayer Relief Act of 1997, and 

19 ‘‘(B) which is eligible to participate in a 

20 program under title IV of the Higher Education 

21 Act of 1965. 

22 ‘‘(d) SPECIAL RULES.— 

23 ‘‘(1) IDENTIFICATION REQUIREMENT.—No 

24 credit shall be allowed under subsection (a) to a tax25 payer with respect to the qualified tuition and reVerDate Nov 24 2008 00:34 Apr 07, 2009 Jkt 079200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H1957.IH H1957

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1 lated expenses of an individual unless the taxpayer 

2 includes the name and taxpayer identification num3 ber of such individual on the return of tax for the 

4 taxable year. 

5 ‘‘(2) ADJUSTMENT FOR CERTAIN SCHOLAR6 SHIPS, ETC.—The amount of qualified tuition and 

7 related expenses otherwise taken into account under 

8 subsection (a) with respect to an individual for an 

9 academic period shall be reduced (before the applica10 tion of subsections (a), (b), and (c)) by the sum of 

11 any amounts paid for the benefit of such individual 

12 which are allocable to such period as— 

13 ‘‘(A) a qualified scholarship which is ex14 cludable from gross income under section 117, 

15 ‘‘(B) an educational assistance allowance 

16 under chapter 30, 31, 32, 34, or 35 of title 38, 

17 United States Code, or under chapter 1606 of 

18 title 10, United States Code, and 

19 ‘‘(C) a payment (other than a gift, be20 quest, devise, or inheritance within the meaning 

21 of section 102(a)) for such individual’s edu22 cational expenses, or attributable to such indi23 vidual’s enrollment at an eligible educational in24 stitution, which is excludable from gross income 

25 under any law of the United States. 


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1 ‘‘(3) TREATMENT OF EXPENSES PAID BY DE2 PENDENT.—If a deduction under section 151 with 

3 respect to an individual is allowed to another tax4 payer for a taxable year beginning in the calendar 

5 year in which such individual’s taxable year begins— 

6 ‘‘(A) no credit shall be allowed under sub7 section (a) to such individual for such individ8 ual’s taxable year, and 

9 ‘‘(B) qualified tuition and related expenses 

10 paid by such individual during such individual’s 

11 taxable year shall be treated for purposes of 

12 this section as paid by such other taxpayer. 

13 ‘‘(4) TREATMENT OF CERTAIN PREPAY14 MENTS.—If qualified tuition and related expenses 

15 are paid by the taxpayer during a taxable year for 

16 an academic period which begins during the first 3 

17 months following such taxable year, such academic 

18 period shall be treated for purposes of this section 

19 as beginning during such taxable year. 

20 ‘‘(5) DENIAL OF DOUBLE BENEFIT.—No credit 

21 shall be allowed under this section for any expense 

22 for which a deduction is allowed under any other 

23 provision of this chapter. 

24 ‘‘(6) NO CREDIT FOR MARRIED INDIVIDUALS

25 FILING SEPARATE RETURNS.—If the taxpayer is a 


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1 married individual (within the meaning of section 

2 7703), this section shall apply only if the taxpayer 

3 and the taxpayer’s spouse file a joint return for the 

4 taxable year. 

5 ‘‘(7) NONRESIDENT ALIENS.—If the taxpayer is 

6 a nonresident alien individual for any portion of the 

7 taxable year, this section shall apply only if such in8 dividual is treated as a resident alien of the United 

9 States for purposes of this chapter by reason of an 

10 election under subsection (g) or (h) of section 6013. 

11 ‘‘(e) REGULATIONS.—The Secretary may prescribe 

12 such regulations as may be necessary or appropriate to 

13 carry out this section, including regulations providing for 

14 a recapture of the credit allowed under this section in 

15 cases where there is a refund in a subsequent taxable year 

16 of any amount which was taken into account in deter17 mining the amount of such credit.’’. 

18 (b) REPEAL OF DEDUCTION FOR QUALIFIED TUI19 TION AND RELATED EXPENSES.— 

20 (1) IN GENERAL.—Part VII of subchapter B of 

21 chapter 1 of the Internal Revenue Code of 1986 is 

22 amended by striking section 222 (relating to quali23 fied tuition and related expenses). 

24 (2) CLERICAL AMENDMENT.—The table of sec25 tion for part VII of subchapter B of chapter 1 of 


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1 such Code is amended by striking the item relating 

2 to section 222. 

3 (c) CONFORMING AMENDMENTS.— 

4 (1) Section 62(a) of such Code is amended by 

5 striking paragraph (18). 

6 (2) Subparagraph (B) of section 72(t)(7) of 

7 such Code is amended by striking ‘‘section 

8 25A(g)(2)’’ and inserting ‘‘section 25A(d)(2)’’. 

9 (3) Section 221(d) of such Code is amended— 

10 (A) by striking ‘‘section 25A(g)(2)’’ in 

11 paragraph (2)(B) and inserting ‘‘section 

12 25A(d)(2)’’, 

13 (B) by striking ‘‘section 25A(f)(2)’’ in 

14 paragraph (2)(B) and inserting ‘‘section 

15 25A(c)(3)’’, and 

16 (C) by striking ‘‘section 25A(b)(3)’’ in 

17 paragraph (3) and inserting ‘‘section 

18 25A(c)(1)’’. 

19 (4) Section 529 of such Code is amended— 

20 (A) by striking ‘‘section 25A(g)(2)’’ in sub21 clause (I) of subsection (c)(3)(B)(v) and insert22 ing ‘‘section 25A(d)(2)’’, and 

23 (B) by striking ‘‘section 25A(b)(3)’’ in 

24 clause (i) of subsection (e)(3)(B) and inserting 

25 ‘‘section 25A(c)(1)’’. 


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1 (5) Section 530 of such Code is amended— 

2 (A) by striking ‘‘section 25A(g)(2)’’ in sub3 clause (I) of subsection (d)(2)(C)(i) and insert4 ing ‘‘section 25A(d)(2)’’, and 

5 (B) by striking ‘‘section 25A(g)(2)’’ in 

6 clause (iii) of subsection (d)(4)(B) and inserting 

7 ‘‘section 25A(d)(2)’’. 

8 (6) Section 1400O of such Code is amended by 

9 adding at the end the following flush sentence: 

10 ‘‘For purposes of this section, any reference to section 25A 

11 shall be treated as a reference to such section before the 

12 date of the enactment of this sentence.’’. 

13 (7) Subsection (e) of section 6050S of such 

14 Code is amended by striking ‘‘(without regard to 

15 subsection (g)(2) thereof)’’ and inserting ‘‘(without 

16 regard to subsection (d)(2) thereof)’’. 

17 (8) Subparagraph (J) of section 6213(g)(2) of 

18 such Code is amended by striking ‘‘section 

19 25A(g)(1)’’ and inserting ‘‘section 25A(d)(1)’’. 

20 (9) The table of sections for subpart A of part 

21 IV of subchapter A of chapter 1 of such Code is 

22 amended by striking the item relating to section 25A 

23 and inserting the following: 

‘‘Sec. 25A. Higher education tuition credit.’’. 


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1 (d) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to taxable years beginning after 

3 December 31, 2010. 

Æ 


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