I 
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. 
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 
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 Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Higher Education En-
dowment Tax Reform Act’’. 
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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 Rev-
enue 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 stu-
dents for academic periods beginning dur-
ing 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 
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‘‘(B) an amount equal to 13 percent of 
such aggregate undergraduate tuition and fees 
so received. 
‘‘(2) INSTITUTION MUST MEET REPORTING RE-
QUIREMENT.— 
‘‘(A) IN
GENERAL.—Paragraph (1) shall 
not apply to an applicable educational institu-
tion for a taxable year unless such institution 
furnishes to the Secretary, and makes widely 
available, a statement detailing the average ag-
gregate amount of Federal student loans re-
ceived by a student for attendance at the insti-
tution, 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 sub-
part 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 
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such Act for attendance at such institu-
tion. 
‘‘(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 Fed-
eral Direct PLUS Loan made on behalf of a de-
pendent student. 
‘‘(3) OTHER
DEFINITIONS.—For purposes of 
this subsection— 
‘‘(A) 
FIRST-TIME, 
FULL-TIME
UNDER-
GRADUATE
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 
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any applicable educational institution, grants 
and scholarships to the extent used for under-
graduate 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 
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‘‘(B) the cost-of-living adjustment deter-
mined under section 1(f)(3) for the calendar 
year in which the taxable year begins, deter-
mined 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 THRESH-
OLD.—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. 
Æ 
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