‘‘(c) TERMINATION
OF BORROWER’S REPAYMENT 
OBLIGATION.— 
‘‘(1) IN GENERAL.—All direct IDEA loans of a 
borrower shall be canceled as of the close of the first 
taxable year for which the current account balance 
of such borrower is not greater than zero. 
‘‘(2) DETERMINATION OF CURRENT ACCOUNT 
BALANCE.— 
‘‘(A) IN GENERAL.—For purposes of deter-
mining the current account balance of the bor-
rower for any taxable year after the 12th tax-
able year that the borrower is in repayment sta-
tus under this section, the current account bal-
ance shall be the amount which would be such 
balance if— 
‘‘(i) the initial account balance of the 
borrower equaled 90 percent of such initial 
account balance (determined without re-
gard to this clause), and 
‘‘(ii) 
clause 
(ii) 
of 
section 
102(d)(3)(C) of the Income-Dependent 
Education Assistance Act of 2007 had 
been applied for all prior periods of repay-
ment status under this section by sub-
stituting ‘2 percent’ for ‘3 percent’. 
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In the case of any taxable year after the 16th 
taxable year that the borrower is in repayment 
status under this section, clause (ii) shall be ap-
plied by substituting ‘1 percent’ for ‘2 percent’. 
‘‘(B) INITIAL
ACCOUNT
BALANCE.—For 
purposes of subparagraph (A), the term ‘initial 
account balance’ means, with respect to any 
borrower, the sum of the amounts owed by the 
borrower on any direct IDEA loan, as contained 
in notices furnished under subsection (a)(2) to 
the Secretary. 
‘‘(3) NO
REPAYMENT
REQUIRED
AFTER
YEARS IN REPAYMENT STATUS.—The borrower has 
no repayment obligation under this section any tax-
able year after the 25th taxable year for which the 
borrower is in repayment status under this section. 
‘‘(4) DETERMINATION
OF
YEARS
IN
REPAY-
MENT STATUS.—For purposes of paragraphs (2) and 
(3), the number of taxable years in which a borrower 
is in repayment status under this section shall be de-
termined without regard to any taxable year before 
the most recent taxable year in which the borrower 
received a direct IDEA loan. 
‘‘(5) EXTENSION OF REPAYMENT YEARS FOR 
MEDICAL INTERNS.—The number of years specified 
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in paragraphs (2) and (3) shall be increased by 1 
year for each calendar year during any 5 months of 
which the individual is an intern in medicine, den-
tistry, veterinary medicine, or osteopathic medicine. 
‘‘(d) DEFINITIONS.—For purposes of this section— 
‘‘(1) MAXIMUM ACCOUNT BALANCE.—The term 
‘maximum account balance’ means the highest 
amount (as of the close of any calendar year) of un-
paid principal and unpaid accrued interest on all di-
rect IDEA loan obligations of a borrower. 
‘‘(2) CURRENT ACCOUNT BALANCE.—The term 
‘current account balance’ means the amount (as of 
the close of a calendar year) of unpaid principal and 
unpaid accrued interest on all IDEA loans of a bor-
rower. 
‘‘(3) REPAYMENT STATUS.—A borrower is in 
repayment status for any taxable year unless— 
‘‘(A) such borrower was, during at least 7 
months of such year, an eligible student, as 
that term is defined in section 104(4) of the In-
come-Dependent Education Assistance Act of 
2007; or 
‘‘(B) such taxable year was the first year 
in which the borrower was such an eligible stu-
dent and the borrower was such an eligible stu-
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