I 

116TH CONGRESS 

1ST SESSION H. R. 1810 

To provide the legal framework and income tax treatment necessary for 

the growth of innovative private financing options, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 18, 2019 

Mr. GREEN of Tennessee (for himself and Mr. GONZALEZ of Texas) introduced the following bill; which was referred to the Committee on Financial Services, and in addition to the Committees on Ways and Means, 

Education and Labor, Armed Services, and Veterans’ Affairs, 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 the legal framework and income tax treatment 

necessary for the growth of innovative private financing 

options, and for other purposes. 

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; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Kids to College Act’’. 

6 (b) TABLE OF CONTENTS.—The table of contents for 

7 this Act is as follows: 


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Sec. 1. Short title; table of contents. 

Sec. 2. Definitions. 

TITLE I—TAX TREATMENT OF INCOME-SHARE AGREEMENTS 

Sec. 101. Tax treatment of proceeds and payments of future income. 

Sec. 102. Terms and conditions of income-share agreement contracts. 

Sec. 103. Rulemaking; model disclosure forms. 

Sec. 104. Truth in Lending Act. 

Sec. 105. Consent to continuing release of taxpayer information under income 

share agreement. 

TITLE II—TREATMENT OF INCOME-SHARE AGREEMENTS UNDER 

STATE LAW 

Sec. 201. Lawfulness of contracts; preemption of State law. 

Sec. 202. Preemption of State law with respect to usury. 

Sec. 203. Preemption of pre-existing State laws with respect to ability-to-repay 

and licensing laws. 

TITLE III—QUALIFIED EDUCATION LOAN 

Sec. 301. Qualified education loan. 

TITLE IV—FEDERAL INDIVIDUAL ASSISTANCE TREATMENT OF 

INCOME-SHARE AGREEMENTS 

Sec. 401. Proceeds not treated as income in calculation of financial need under 

the Higher Education Act of 1965. 

TITLE V—TREATMENT UNDER SECURITIES LAWS 

Sec. 501. Income-share agreements not treated as securities. 

Sec. 502. Businesses making income-share agreements excluded from investment company treatment. 

TITLE VI—TREATMENT UNDER FEDERAL CONSUMER FINANCE 

LAWS 

Sec. 601. Income-share agreement anti-discrimination protections. 

Sec. 602. Prohibition on requiring preauthorized electronic fund transfers. 

Sec. 603. Treatment under the Fair Credit Reporting Act. 

Sec. 604. Application of the Military Lending Act. 

Sec. 605. Application of the Servicemembers Civil Relief Act. 

Sec. 606. Rulemaking. 

TITLE VII—TREATMENT UNDER OTHER LAWS 

Sec. 701. Insurance and wagering. 

Sec. 702. Payments not considered prepayments. 

1 SEC. 2. DEFINITIONS. 

2 For purposes of this Act: 


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1 (1) COMPARABLE LOAN.—The term ‘‘com2 parable loan’’ means, with respect to an income3 share agreement, a loan that— 

4 (A) has an original principal amount such 

5 that, after any origination fees on the loan are 

6 paid, the amount of loan financing received by 

7 the individual is equal to the total amount of 

8 funding provided under the income-share agree9 ment to or on behalf of the individual subject 

10 to the agreement; 

11 (B) has the same term to maturity as the 

12 duration of the income-share agreement; and 

13 (C) is fully amortized over such term with 

14 monthly payments of principal and interest. 

15 (2) INCOME-SHARE AGREEMENT.—The term 

16 ‘‘income-share agreement’’ means an agreement— 

17 (A) between an individual and an ISA 

18 funder; 

19 (B) which meets the requirements of sec20 tion 102; and 

21 (C) under which— 

22 (i) the ISA funder pays amounts to, 

23 or on behalf of, such individual for costs 

24 associated with a postsecondary training 

25 program, or any other program designed to 


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1 increase the individual’s human capital, 

2 employability, or earning potential (and 

3 not limited to programs eligible to partici4 pate in programs under title IV of the 

5 Higher Education Act of 1965), as well as 

6 any personal expenses (such as books, sup7 plies, transportation, and living costs) in8 curred by the individual while enrolled in 

9 such a program, or for the refinancing of 

10 debt used for these purposes (hereinafter 

11 in this Act referred to as ‘‘income-share 

12 funding’’); and 

13 (ii) such individual pays to such ISA 

14 funder (or the ISA funder’s successor in 

15 interest) amounts equal to a specified per16 centage of the individual’s future income, 

17 for a defined term (hereinafter in this Act 

18 referred to as ‘‘income-share payments’’). 

19 (3) ISA FUNDER.—With respect to an income20 share agreement, the term ‘‘ISA funder’’ means the 

21 party to such agreement who— 

22 (A) pays amounts to, or on behalf of, an 

23 individual solely for the purposes specified in 

24 paragraph (2)(C)(i); and 


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1 (B) has the right to receive a specified per2 centage of the individual’s future income. 

3 (4) QUALIFIED ISA.—The term ‘‘Qualified ISA’’ 

4 means an income-share agreement that complies 

5 with the following: 

6 (A) AFFORDABILITY FOR LOW AFTER7 SCHOOL INCOME.—The income-share agreement 

8 provides that when an individual subject to the 

9 agreement has an income that is equal to or 

10 below the amount that is 150 percent of the 

11 poverty line for a single person (as defined in 

12 section 673 of the Community Services Block 

13 Grant Act (42 U.S.C. 9902)), the percentage of 

14 income obligation for the individual is zero. The 

15 preceding sentence may not be interpreted to 

16 preclude the charging of fees or nominal pay17 ments (as described under section 102(a)(5)) 

18 during this period. 

19 (B) LIMIT ON PERCENTAGE OF INCOME.— 

20 The maximum percentage of income an indi21 vidual would be required to pay under the 

22 agreement does not exceed 20 percent, and the 

23 product of such percentage and the number of 

24 years of the agreement does not exceed 2.25 

25 (which figure is the product of 7.5 percent and 


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1 the number of years in the longest allowable 

2 contract under section 102(a)(3)). 

3 (C) APPROPRIATE RISK SHARING.—The 

4 payments required under such agreement for an 

5 individual with income during the payment 

6 term equal to 175 percent of the poverty line 

7 for a single person (as defined in section 673 

8 of the Community Services Block Grant Act 

9 (42 U.S.C. 9902)) would not exceed the pay10 ments on a comparable loan that bears interest 

11 at a rate equal to the annual percentage rate of 

12 interest limitation under section 987(b) of title 

13 10, United States Code. 

14 (5) STATE.—The term ‘‘State’’ means the sev15 eral States of the Union, the Commonwealth of 

16 Puerto Rico, the District of Columbia, Guam, Amer17 ican Samoa, the Virgin Islands, the Government of 

18 the Northern Mariana Islands, and the Trust Terri19 tory of the Pacific Islands. 

20 (6) STATE LAW.—The term ‘‘State law’’ means 

21 any law, decision, rule, regulation, or other action 

22 having the effect of a law of any State or any polit23 ical subdivision of a State, or any agency or instru24 mentality of a State or political subdivision of a 

25 State, except that a law of the United States appliVerDate Sep 11 2014 22:40 Apr 05, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H1810.IH H1810

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1 cable only to the District of Columbia shall be treat2 ed as a State law (rather than a law of the United 

3 States). 

4 TITLE I—TAX TREATMENT OF 

5 INCOME-SHARE AGREEMENTS 

6 SEC. 101. TAX TREATMENT OF PROCEEDS AND PAYMENTS 

7 OF FUTURE INCOME. 

8 For purposes of the Internal Revenue Code of 

9 1986— 

10 (1) FUNDING EXCLUDED FROM GROSS IN11 COME.—In the case of an individual, gross income 

12 shall not include the amount of any income-share 

13 funding which is paid to or on behalf of such indi14 vidual under an income-share agreement. 

15 (2) DIFFERENCE IN REPAYMENT NOT IN16 CLUDED AS GROSS INCOME.—In the case of an in17 come-share agreement under which the income-share 

18 funding exceeds the total income-share payments (in 

19 any period over the life of the contract), the individ20 ual’s gross income shall not include the amount of 

21 such excess. 

22 (3) TREATMENT OF PAYMENTS OF FUTURE IN23 COME.—The amount of any income-share payments 

24 under an income-share agreement shall be treated— 


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1 (A) first, with respect to so much of such 

2 amount as does not exceed the income-share 

3 funding under such agreement, as a recovery of 

4 investment (with a corresponding reduction in 

5 basis) in the contract; and 

6 (B) second, as income on the contract 

7 which is includible in gross income. 

8 SEC. 102. TERMS AND CONDITIONS OF INCOME-SHARE 

9 AGREEMENT CONTRACTS. 

10 (a) TERMS AND CONDITIONS.—An income-share 

11 agreement shall not be treated as meeting the require12 ments of this section unless: 

13 (1) SPECIFIED PERCENTAGE OF INCOME.—The 

14 agreement specifies the percentage of future income 

15 required to be paid. 

16 (2) DEFINITION OF INCOME.—The income17 share agreement specifies the definition of income to 

18 be used for purposes of calculating an individual’s 

19 obligation to pay under the agreement, which shall 

20 not in any case include the income of the individ21 ual’s children. 

22 (3) SPECIFIED DURATION; EXTENSION OF PE23 RIOD.— 

24 (A) DURATION.—The agreement specifies 

25 the maximum period of time during which the 


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1 individual will be obligated to pay a percentage 

2 of the individual’s future income (excluding pe3 riods when just a nominal payment (as de4 scribed under paragraph (5)) is required), 

5 which may not (except as provided in subpara6 graph (B)) exceed 360 months. 

7 (B) EXTENSION OF PERIOD.—The agree8 ment may provide for the extension of such pe9 riod by a number of months during which the 

10 individual’s percentage of income obligation (ex11 cluding nominal payments and fees) was zero, 

12 either because of further enrollment in edu13 cation or training or the individual’s income 

14 was below the level at which payments are re15 quired in the agreement. 

16 (4) EARLY TERMINATION.—The agreement 

17 specifies the terms and conditions under which the 

18 individual subject to the agreement may terminate 

19 the agreement. 

20 (5) NOMINAL PAYMENTS.—The agreement 

21 specifies any nominal monthly payment that is re22 quired during periods when the individual subject to 

23 the agreement has no percentage of income obliga24 tion, except that such nominal monthly payment 

25 shall not exceed twenty-five dollars per month (adVerDate Sep 11 2014 22:40 Apr 05, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H1810.IH H1810

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1 justed each year to reflect changes in the Consumer 

2 Price Index for All Urban Consumers published by 

3 the Bureau of Labor Statistics of the Department of 

4 Labor for the most recent 12-month period for 

5 which the data are available). 

6 (b) REQUIRED DISCLOSURES.—An income-share 

7 agreement does not comply with the requirements of this 

8 section unless the individual who is committing under the 

9 agreement to pay future income is provided, before enter10 ing into such agreement, a written document that clearly 

11 and simply discloses— 

12 (1) that the agreement is not a debt instru13 ment, and that the amount the individual will be re14 quired to pay under the agreement— 

15 (A) may be more or less than the amount 

16 provided to the individual pursuant to the 

17 agreement; and 

18 (B) will vary in proportion to the individ19 ual’s future income; 

20 (2) that the obligations of the individual under 

21 the agreement are not dischargeable under bank22 ruptcy law, except in a case that would impose an 

23 undue hardship on the debtor and the debtor’s de24 pendents; 


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1 (3) whether the obligations of the individual 

2 under the agreement may be extinguished through 

3 prepayment and, if so, under what terms; 

4 (4) the duration of the individual’s obligations 

5 under the agreement (absent such prepayments), in6 cluding any circumstances under which the duration 

7 of the agreement would be extended or discharged; 

8 (5) the percentage of income the individual is 

9 committing to pay under the agreement, including 

10 whether the percentage of income is fixed or variable 

11 under the agreement, and the minimum amount of 

12 annual income that triggers the individual’s obliga13 tion under the agreement to make payments for 

14 such year; 

15 (6) the definition of income to be used for pur16 poses of calculating the individual’s obligation under 

17 the agreement; 

18 (7) a comparison of— 

19 (A) the amounts an individual would be re20 quired to pay under the income-share agree21 ment at a range of annual income levels, which 

22 income levels shall correspond to the levels the 

23 individual might reasonably be expected to 

24 make given the intended use of the funds pro25 vided under the agreement, as determined in 


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1 accordance with guidance issued by the Direc2 tor of the Bureau of Consumer Financial Pro3 tection; to 

4 (B) the amounts required to be paid under 

5 one or more comparable loans, including a loan 

6 at an interest rate determined by the Director 

7 of the Bureau of Consumer Financial Protec8 tion to be an approximation of the interest rate 

9 available to student loan borrowers in the pri10 vate marketplace and, where applicable, a Fed11 eral Stafford loan; 

12 (8) income verification documentation, includ13 ing personal tax records submitted to the Internal 

14 Revenue Service, that the individual may be required 

15 to provide under the agreement; 

16 (9) intent to conduct annual reconciliation re17 lating to obligations owed by the individual under 

18 the agreement; and 

19 (10) any nominal payments required under the 

20 agreement. 

21 (c) NON-INTERFERENCE.—An income-share agree22 ment represents an obligation by the individual pay the 

23 specific percentage of future income, but shall not be con24 strued to give the contract holder any rights over an indi25 vidual’s actions. 


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1 (d) EFFECT OF FAILURE TO PROVIDE DOCUMENTA2 TION.— 

3 (1) IN GENERAL.—Absent income documenta4 tion from an individual under an income-share 

5 agreement, the ISA funder of such agreement (or 

6 the funder’s successor in interest) may assume a 

7 certain income level for the individual, up to the 

8 level that would create an obligation equal to the 

9 maximum payment amount under the agreement. 

10 (2) TREATMENT UNDER STATE LAW.—Any obli11 gation resulting from an assumed income level under 

12 paragraph (1) shall not be considered to be imposing 

13 an unlawful fee under a State law unless such State 

14 law was issued after the date of the enactment of 

15 this Act and such State law expressly states that it 

16 is intended to apply to income-share agreements. 

17 (3) VERIFICATION OF INCOME.—If an indi18 vidual supplies an ISA funder (or its successor in in19 terest) with their income verification information 

20 within 180 days of the ISA funder (or its successor 

21 in interest) assuming an income level for such indi22 vidual under paragraph (1), the individual shall be 

23 entitled to have any payments that were made in ex24 cess of their actual obligation under the contract eiVerDate Sep 11 2014 22:40 Apr 05, 2019 Jkt 089200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\H1810.IH H1810

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1 ther refunded to them or credited to future obliga2 tions under the contract. 

3 SEC. 103. RULEMAKING; MODEL DISCLOSURE FORMS. 

4 (a) NO BUREAU GENERAL RULEMAKING AUTHOR5 ITY.—Except as provided under subsection (b) and section 

6 102(b)(7), the Director of the Bureau of Consumer Finan7 cial Protection may not issue regulations under this title. 

8 (b) MODEL DISCLOSURE FORMS.— 

9 (1) IN GENERAL.—Not later than 180 days 

10 after the date of the enactment of this Act, the Di11 rector of the Bureau of Consumer Financial Protec12 tion, after engaging in appropriate consumer testing 

13 of such forms, shall promulgate a model disclosure 

14 form for the disclosures required under section 

15 102(b). 

16 (2) SAFE HARBOR.—Any person who uses the 

17 model disclosure form promulgated pursuant to 

18 paragraph (1) and includes accurate information re19 quired under section 102(b) shall be deemed to be 

20 in compliance with the disclosure requirements 

21 under section 102(b). 

22 SEC. 104. TRUTH IN LENDING ACT. 

23 Any income-share agreement that complies with the 

24 disclosure requirements of section 102(b) shall be deemed 

25 to be in compliance with the Truth in Lending Act. 


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1 SEC. 105. CONSENT TO CONTINUING RELEASE OF TAX2 PAYER INFORMATION UNDER INCOME SHARE 

3 AGREEMENT. 

4 The Secretary of the Treasury shall modify Treasury 

5 Regulations and guidance to provide for continuing con6 sent to disclosure of an individual’s return information to 

7 an ISA funder (or the funder’s successor in interest) 

8 under an income-share agreement, but only for periods rel9 evant to, and only to the extent the Secretary determines 

10 is necessary and appropriate in carrying out the terms of, 

11 such agreement. 

12 TITLE II—TREATMENT OF IN13 COME-SHARE AGREEMENTS 

14 UNDER STATE LAW 

15 SEC. 201. LAWFULNESS OF CONTRACTS; PREEMPTION OF 

16 STATE LAW. 

17 Any income-share agreement that complies with the 

18 requirements of section 102 shall be a valid, binding, and 

19 enforceable contract notwithstanding any State law lim20 iting or otherwise regulating assignments of future wages 

21 or other income. 

22 SEC. 202. PREEMPTION OF STATE LAW WITH RESPECT TO 

23 USURY. 

24 A Qualified ISA shall not be subject to State law with 

25 respect to usury, unless such State law was issued after 

26 the date of the enactment of this Act and such State law 


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1 expressly states that it is intended to apply to income2 share agreements. 

3 SEC. 203. PREEMPTION OF PRE-EXISTING STATE LAWS 

4 WITH RESPECT TO ABILITY-TO-REPAY AND 

5 LICENSING LAWS. 

6 A Qualified ISA shall not be subject to a State law 

7 with respect to ‘‘ability-to-repay’’ requirements, and an 

8 ISA funder issuing a Qualified ISA shall not be subject 

9 to any State law with respect to licensing or registration, 

10 unless such State law was issued after the date of the en11 actment of this Act and such State law expressly states 

12 that it is intended to apply to income-share agreements. 

13 TITLE III—QUALIFIED 

14 EDUCATION LOAN 

15 SEC. 301. QUALIFIED EDUCATION LOAN. 

16 (a) IN GENERAL.—Paragraph (1) of section 221(d) 

17 of the Internal Revenue Code of 1986 is amended by add18 ing at the end the following: ‘‘Such term includes any in19 come-share agreement (as such term is defined in section 

20 2 of the Help Our Graduates Act) that complies with the 

21 requirements of section 102 of such Act, except that pay22 ments made by the taxpayer during the taxable year to 

23 meet an income-share agreement obligation shall not be 

24 taken into account under subsection (a).’’. 


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1 (b) INFORMATION REPORTING NOT REQUIRED.— 

2 Subsection (e) of section 6050S of such Code is amended 

3 by inserting ‘‘(without regard to the last sentence there4 of)’’ after ‘‘section 221(d)(1)’’. 

5 TITLE IV—FEDERAL INDIVIDUAL 

6 ASSISTANCE TREATMENT OF 

7 INCOME-SHARE AGREEMENTS 

8 SEC. 401. PROCEEDS NOT TREATED AS INCOME IN CAL9 CULATION OF FINANCIAL NEED UNDER THE 

10 HIGHER EDUCATION ACT OF 1965. 

11 No portion of any amounts received by an individual 

12 for entering into an income-share agreement that complies 

13 with the requirements of section 102 of this Act shall be 

14 included as income or assets in the computation of ex15 pected family contribution for any program funded in 

16 whole or in part under the Higher Education Act of 1965 

17 (20 U.S.C. 1001 et seq.). 

18 TITLE V—TREATMENT UNDER 

19 SECURITIES LAWS 

20 SEC. 501. INCOME-SHARE AGREEMENTS NOT TREATED AS 

21 SECURITIES. 

22 An income-share agreement shall not be treated as 

23 a security for purposes of the securities laws (as defined 

24 in section 3(a) of the Securities Exchange Act of 1934 

25 (15 U.S.C. 78c(a))), any similar State law, or any State 


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1 law that directly or indirectly prohibits, limits, or imposes 

2 conditions, based on the merits of an offering or issuer 

3 of securities, upon the offer or sale of any security. Noth4 ing in the preceding sentence shall be construed to prevent 

5 an instrument that is collateralized by, or serviced by the 

6 cash flows of, an income-share agreement from being 

7 treated as a security for purposes of any law described 

8 in such sentence. 

9 SEC. 502. BUSINESSES MAKING INCOME-SHARE AGREE10 MENTS EXCLUDED FROM INVESTMENT COM11 PANY TREATMENT. 

12 Section 3(c) of the Investment Company Act of 1940 

13 (15 U.S.C. 80a–3(c)) is amended— 

14 (1) in paragraph (4), by inserting after ‘‘indus15 trial banking,’’ the following: ‘‘income-share agree16 ments (as defined in section 2 of the Help Our 

17 Graduates Act),’’; and 

18 (2) in paragraph (5)— 

19 (A) by inserting ‘‘, including purchasing or 

20 otherwise acquiring income-share agreements 

21 (as defined in section 2 of the Help Our Grad22 uates Act)’’ after ‘‘services’’ the first place it 

23 appears; and 


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1 (B) by inserting ‘‘, including making in2 come-share agreements (as so defined)’’ after 

3 ‘‘services’’ the second place it appears. 

4 TITLE VI—TREATMENT UNDER 

5 FEDERAL CONSUMER FI6 NANCE LAWS 

7 SEC. 601. INCOME-SHARE AGREEMENT ANTI-DISCRIMINA8 TION PROTECTIONS. 

9 Section 702 of the Equal Credit Opportunity Act (15 

10 U.S.C. 1691a) is amended— 

11 (1) in subsection (d), by inserting before the pe12 riod the following: ‘‘, or the right granted under an 

13 income-share agreement (as defined in section 2 of 

14 the Help Our Graduates Act)’’; and 

15 (2) in subsection (e)— 

16 (A) by striking ‘‘or any assignee’’ and in17 serting ‘‘any assignee’’; and 

18 (B) by inserting before the period the fol19 lowing: ‘‘; or any person who regularly extends, 

20 renews, or continues funding under an income21 share agreement (as defined in section 2 of the 

22 Help Our Graduates Act)’’. 


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1 SEC. 602. PROHIBITION ON REQUIRING PREAUTHORIZED 

2 ELECTRONIC FUND TRANSFERS. 

3 Section 913(1) of the Electronic Fund Transfer Act 

4 (15 U.S.C. 1693k(1)) is amended by inserting after ‘‘a 

5 consumer’’ the following: ‘‘or the entering into of an in6 come-share agreement (as defined in section 2 of the Help 

7 Our Graduates Act) with a consumer’’. 

8 SEC. 603. TREATMENT UNDER THE FAIR CREDIT REPORT9 ING ACT. 

10 Section 605 of the Fair Credit Reporting Act (15 

11 U.S.C. 1681c) is amended by adding at the end the fol12 lowing: 

13 ‘‘(i) INCOME-SHARE AGREEMENT INFORMATION.— 

14 With respect to an income-share agreement (as defined in 

15 section 2 of the Help Our Graduates Act), a consumer 

16 report made by a consumer reporting agency— 

17 ‘‘(1) may include a description of the contract 

18 terms of the income-share agreement and, subject to 

19 subsection (a), information with respect to amounts 

20 that are owed under such agreement; and 

21 ‘‘(2) may not include any speculation about fu22 ture amounts that may be owed under the income23 share agreement.’’. 

24 SEC. 604. APPLICATION OF THE MILITARY LENDING ACT. 

25 Section 987 of title 10, United States Code, is 

26 amended— 


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1 (1) by redesignating subsection (i) as subsection 

2 (j); and 

3 (2) by inserting after subsection (h) the fol4 lowing: 

5 ‘‘(i) TREATMENT OF INCOME-SHARE AGREE6 MENTS.—The Secretary of Defense shall issue regulations 

7 to apply this section to income-share agreements (as de8 fined in section 2 of the Help Our Graduates Act), and 

9 an income-share agreement shall be deemed to meet the 

10 annual percentage rate of interest limitation under sub11 section (b) if such agreement would meet the requirements 

12 of section 2(4)(C) of the Kids to College Act (related to 

13 appropriate risk sharing) but with reference to the rate 

14 specified in subsection (b).’’. 

15 SEC. 605. APPLICATION OF THE SERVICEMEMBERS CIVIL 

16 RELIEF ACT. 

17 Section 207 of the Servicemembers Civil Relief Act 

18 (50 U.S.C. 3937) is amended by adding at the end the 

19 following: 

20 ‘‘(f) TREATMENT OF INCOME-SHARE AGREE21 MENTS.—The Secretary of Defense shall issue regulations 

22 to apply this section to income-share agreements (as de23 fined in section 2 of the Help Our Graduates Act), specifi24 cally by stating that an income-share agreement shall be 

25 considered to have met the requirements of this section 


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1 if the agreement would meet the requirements of section 

2 2(4)(C) of the Kids to College Act (relating to appropriate 

3 risk sharing) but with reference to the rate specified in 

4 subsection (a)(1).’’. 

5 SEC. 606. RULEMAKING. 

6 Not later than 180 days after the date of enactment 

7 of this Act— 

8 (1) the Director of the Bureau of Consumer Fi9 nancial Protection shall issue regulations to carry 

10 out the amendments made by section 601 and 602; 

11 and 

12 (2) the Secretary of Defense shall issue regula13 tions to carry out the amendment made by section 

14 604 and 605. 

15 TITLE VII—TREATMENT UNDER 

16 OTHER LAWS 

17 SEC. 701. INSURANCE AND WAGERING. 

18 Income-share agreements shall not be treated as a 

19 contract for insurance or a betting or wagering contract 

20 under any Federal or State law. 

21 SEC. 702. PAYMENTS NOT CONSIDERED PREPAYMENTS. 

22 With respect to an income-share agreement, any re23 quirement that an individual pay an amount greater than 

24 the income-share funding in order to extinguish the in25 come-share agreement obligation earlier than the end of 


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1 the term shall not be considered a prepayment penalty for 

2 purposes of any Federal or State law with respect to pre3 payment penalties. 

Æ 


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