I 
114TH CONGRESS 
2D SESSION 
H. R. 4652 
To amend the Higher Education Act of 1965 to codify the Revised Pay 
As You Earn Repayment plan, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
FEBRUARY 29, 2016 
Mr. TAKAI (for himself, Ms. JUDY CHU of California, Mr. HONDA, Ms. NOR-
TON, Mr. BRADY of Pennsylvania, Ms. CLARKE of New York, Mr. 
BRENDAN F. BOYLE of Pennsylvania, Ms. MOORE, Mr. PALLONE, Ms. 
LEE, Mr. TED LIEU of California, Mrs. WATSON COLEMAN, Mr. NOLAN, 
Ms. SCHAKOWSKY, Mr. RANGEL, and Ms. JACKSON LEE) introduced the 
following bill; which was referred to the Committee on Education and the 
Workforce, and in addition to the Committee on Ways and Means, 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 com-
mittee concerned 
A BILL 
To amend the Higher Education Act of 1965 to codify the 
Revised Pay As You Earn Repayment plan, 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 ‘‘Clarity in Lending for 
Education and Repayment Act’’ or the ‘‘CLEAR Act’’. 
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SEC. 2. STREAMLINING REPAYMENT PLANS FOR NEW BOR-
ROWERS. 
Section 455 of the Higher Education Act of 1965 (20 
U.S.C. 1087e) is amended by striking subsection (d) and 
inserting the following: 
‘‘(d) REPAYMENT PLANS.— 
‘‘(1) DESIGN AND SELECTION FOR BORROWERS 
BEFORE JULY 1, 2016.—With respect to a borrower 
of a loan made under this part before July 1, 2016, 
and consistent with criteria established by the Sec-
retary, the Secretary shall offer such borrower a va-
riety of plans for repayment of such loan, including 
principal and interest on the loan. The borrower 
shall be entitled to accelerate, without penalty, re-
payment on the borrower’s loans under this part. 
The borrower may choose— 
‘‘(A) a standard repayment plan, con-
sistent with subsection (a)(1) of this section 
and with section 428(b)(9)(A)(i); 
‘‘(B) a graduated repayment plan, con-
sistent with section 428(b)(9)(A)(ii); 
‘‘(C) an extended repayment plan, con-
sistent with section 428(b)(9)(A)(iv), except 
that the borrower shall annually repay a min-
imum amount determined by the Secretary in 
accordance with section 428(b)(1)(L); 
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‘‘(D) an income contingent repayment 
plan, with varying annual repayment amounts 
based on the income of the borrower, paid over 
an extended period of time prescribed by the 
Secretary, not to exceed 25 years, except that 
the plan described in this subparagraph shall 
not be available to the borrower of a Federal 
Direct PLUS loan made on behalf of a depend-
ent student; and 
‘‘(E) an income-based repayment plan that 
enables borrowers who have a partial financial 
hardship to make a lower monthly payment in 
accordance with section 493C, except that the 
plan described in this subparagraph shall not be 
available to the borrower of a Federal Direct 
PLUS Loan made on behalf of a dependent 
student or a Federal Direct Consolidation 
Loan, if the proceeds of such loan were used to 
discharge the liability on such Federal Direct 
PLUS Loan or a loan under section 428B 
made on behalf of a dependent student. 
‘‘(2) DESIGN AND SELECTION FOR NEW BOR-
ROWERS ON OR AFTER JULY 1, 2016.—The Secretary 
shall offer a borrower of a loan made under this part 
on or after July 1, 2016, the following plans for re-
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ture payments by such borrowers, of loans made 
using the plans available under paragraph (2). 
‘‘(6) REPAYMENT AFTER DEFAULT.—For any 
borrower who has defaulted on a loan made under 
this part, the Secretary— 
‘‘(A) may require the borrower to pay all 
reasonable collection costs associated with such 
loan; and 
‘‘(B) if such loan was made— 
‘‘(i) to any borrower who, before July 
1, 2016, had an outstanding balance on a 
student loan made, insured, or guaranteed 
under this part or part B, may require the 
borrower to repay the loan pursuant to an 
income contingent repayment plan, as de-
scribed in paragraph (1)(D), or an income- 
based repayment plan, as described in 
paragraph (1)(E); or 
‘‘(ii) to a new borrower (as defined in 
section 493E(a)(5)), may provide the bor-
rower the option to enroll in the repayment 
plan described in paragraph (2)(B). 
‘‘(7) APPLICABILITY PROVISION.— 
‘‘(A) IN GENERAL.—Except as provided in 
paragraph (5) and subparagraph (B), the re-
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payment plans under subparagraphs (B), (C), 
(D), and (E) of paragraph (1) are not available 
for a borrower who received the borrower’s first 
disbursement of a Federal Direct Loan on or 
after July 1, 2016. 
‘‘(B) EXCEPTION.—The repayment plans 
available to a borrower of a Federal Direct 
PLUS Loan made on behalf of a dependent 
student or a Federal Direct Consolidation Loan 
whose proceeds were used to discharge the li-
ability of a Federal Direct PLUS Loan made 
on behalf of a dependent student or a loan 
under section 428B made on behalf of a de-
pendent student on or after July 1, 2016, shall 
be those described under subparagraphs (A), 
(B), and (C) of paragraph (1).’’. 
SEC. 3. REPAYE. 
Part D of title IV of the Higher Education Act of 
1965 (20 U.S.C. 1087a et seq.) is amended by adding at 
the end the following: 
‘‘SEC. 461. REPAYE. 
‘‘(a) DEFINITIONS.— 
‘‘(1) COVERED FEDERAL DIRECT LOAN.—The 
term ‘covered Federal Direct Loan’ means a Federal 
Direct Stafford Loan, a Federal Direct Unsubsidized 
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Stafford Loan, a Federal Direct Consolidation Loan 
(other than an excepted consolidation loan), or a 
Federal Direct PLUS Loan (other than an excepted 
plus loan) made under this part. 
‘‘(2) NEW
BORROWER.—The term ‘new bor-
rower’ means a borrower who— 
‘‘(A) as of July 1, 2016, has no out-
standing balance on a student loan made, in-
sured, or guaranteed under part B or D; or 
‘‘(B) has no outstanding balance on a stu-
dent loan made, insured, or guaranteed under 
part B or D on the date the borrower receives 
a loan made under part D on or after July 1, 
2016. 
‘‘(3) EXCEPTED PLUS LOAN; EXCEPTED CON-
SOLIDATION LOAN.—The terms ‘excepted plus loan’ 
and ‘excepted consolidation loan’ have the meanings 
given such terms in section 493C. 
‘‘(4) INCOME-DRIVEN CALCULATION.— 
‘‘(A) IN
GENERAL.—The term ‘income- 
driven calculation’— 
‘‘(i) when used with respect to an un-
married borrower 10 percent of the result 
obtained by calculating, on at least an an-
nual basis, the amount by which— 
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‘‘(I) 
the 
borrower’s 
adjusted 
gross income, as defined by the Sec-
retary; exceeds 
‘‘(II) 150 percent of the poverty 
line applicable to the borrower’s fam-
ily size as determined under section 
673(2) of the Community Services 
Block Grant Act (42 U.S.C. 9902(2)); 
and 
‘‘(ii) subject to subparagraph (B), 
when used with respect to a married bor-
rower— 
‘‘(I) the difference between the 
borrower’s and borrower’s spouse’s 
adjusted gross income, as defined by 
the Secretary; exceeds 
‘‘(II) 150 percent of the poverty 
line applicable to the borrower’s fam-
ily size as determined under section 
673(2) of the Community Services 
Block Grant Act (42 U.S.C. 9902(2)). 
‘‘(B) EXCEPTION FOR CERTAIN MARRIED 
BORROWERS.—The income-driven calculation 
under subparagraph (A)(i) shall apply to a 
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married borrower who certifies, on a form ap-
proved by the Secretary that the borrower is— 
‘‘(i) separated from the borrower’s 
spouse; or 
‘‘(ii) unable to reasonably access the 
income information of the borrower’s 
spouse. 
‘‘(b) REVISED PAY AS YOU EARN REPAYMENT PLAN 
AUTHORIZED.—Notwithstanding any other provision of 
this Act, the Secretary shall carry out a program for new 
borrowers that meets the following requirements: 
‘‘(1) MONTHLY PAYMENT AMOUNT.—Except as 
otherwise provided in this subsection, a new bor-
rower of any covered Federal Direct Loan may elect 
to have the borrower’s aggregate monthly payment 
for all such loans not to exceed the result of the in-
come-driven calculation divided by 12. 
‘‘(2) 
ADJUSTED
MONTHLY
PAYMENT 
AMOUNT.—The Secretary adjusts the aggregate 
monthly payment under paragraph (1), if— 
‘‘(A) in addition to covered Federal Direct 
Loans, the borrower has an outstanding loan 
made under part B (other than an excepted 
PLUS Loan or an excepted consolidation loan), 
in which case the Secretary determines the bor-
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rower’s adjusted monthly payment by multi-
plying the aggregate monthly payment by the 
percentage of the total outstanding principal 
amount of the borrower’s covered Federal Di-
rect Loans; 
‘‘(B) the borrower and borrower’s spouse 
have covered Federal Direct Loans and out-
standing loans under part B (other than an ex-
cepted PLUS Loan or an excepted consolidation 
loan), in which case the Secretary determines— 
‘‘(i) each borrower’s percentage of the 
couple’s total outstanding amount of prin-
cipal on such loans; 
‘‘(ii) the adjusted monthly payment 
for each borrower by multiplying the bor-
rower’s aggregate monthly payment by the 
percentage determined under clause (i) ap-
plicable to the borrower; and 
‘‘(iii) if the borrower’s loans are held 
by multiple holders, the borrower’s ad-
justed monthly payment for covered Fed-
eral Direct Loans by multiplying the ad-
justed monthly payment determined under 
clause (ii) by the percentage of the total 
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outstanding principal amount of the bor-
rower’s covered Federal Direct Loans; 
‘‘(C) the calculated monthly payment 
amount under paragraph (1) or this paragraph 
is less than $5.00, in which case the borrower’s 
monthly payment is $0.00; or 
‘‘(D) the calculated monthly payment 
amount under paragraph (1) or this paragraph 
or is equal to or greater than $5.00 but less 
than $10.00, in which case the borrower’s 
monthly payment is $10.00. 
‘‘(3) ACCRUED INTEREST.— 
‘‘(A) IN
GENERAL.—If the borrower’s 
monthly payment amount under paragraph (1) 
or (2) is not sufficient to pay the accrued inter-
est on the borrower’s loan— 
‘‘(i) for a Federal Direct Stafford 
Loan or the portion of a Federal Direct 
Consolidation Loan attributable to a Fed-
eral Direct Stafford Loan— 
‘‘(I) the Secretary does not 
charge the borrower the remaining ac-
crued interest for a period not to ex-
ceed 3 consecutive years beginning at 
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graph (A)(i) does not include any period during 
which the borrower receives an economic hard-
ship deferment. 
‘‘(C) CAPITALIZATION OF ACCRUED INTER-
EST.— 
‘‘(i) TIMING.—Accrued interest is cap-
italized at the time a borrower leaves the 
program under this section. 
‘‘(ii) CAPITALIZATION.— 
‘‘(I) LIMITATION.—The amount 
of accrued interest capitalized under 
clause (i)(I) is limited to 10 percent of 
the original principal balance at the 
time the borrower entered repayment 
under the plan under this section. 
‘‘(II) PARTICIPATION.—After the 
amount of accrued interest reaches 
the limit described in subclause (I), 
interest continues to accrue, but is not 
capitalized while the borrower partici-
pates in the plan under this section. 
‘‘(4) POSTPONEMENT
OF
PRINCIPAL
PAY-
MENT.—If the borrower’s monthly payment amount 
is not sufficient to pay any of the principal due, the 
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payment of that principal is postponed until the bor-
rower leaves the plan under this section. 
‘‘(5) SELECTION
OF
DIFFERENT
REPAYMENT 
PLAN.—A borrower who no longer wishes to repay 
under the plan under this section may change to a 
standard repayment plan in accordance with section 
455(d)(3). 
‘‘(6) PAYMENT
APPLICATION
AND
PREPAY-
MENT.— 
‘‘(A) IN GENERAL.—The Secretary applies 
any payment made under the program under 
this section in the following order: 
‘‘(i) Accrued interest. 
‘‘(ii) Collection costs. 
‘‘(iii) Late charges. 
‘‘(iv) Loan principal. 
‘‘(B) 
PREPAYMENT
AUTHORIZED.—The 
borrower may prepay all or part of a loan at 
any time without penalty, as authorized under 
section 455(d)(1). 
‘‘(C) APPLICATION
OF
PREPAYMENT.—If 
the prepayment amount equals or exceeds— 
‘‘(i) a monthly payment amount of 
$10.00 or more under the repayment 
schedule established for the loan, the Sec-
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retary applies the prepayment consistent 
with the requirements of section 455(d)(1); 
or 
‘‘(ii) a monthly payment amount of 
$0.00 under the repayment schedule estab-
lished for the loan, the Secretary applies 
the prepayment consistent with the re-
quirements of subparagraph (A). 
‘‘(7) 
ELIGIBILITY
DOCUMENTATION, 
VERIFICATION, AND NOTIFICATIONS.— 
‘‘(A) DOCUMENTATION.— 
‘‘(i) AGI.—The Secretary requires the 
borrower to provide documentation, accept-
able to the Secretary, of the borrower’s ad-
justed gross income. 
‘‘(ii) 
OTHER
DOCUMENTATION.—If 
the borrower’s adjusted gross income is not 
available, or if the Secretary believes that 
the borrower’s reported adjusted gross in-
come does not reasonably reflect the bor-
rower’s current income, the borrower must 
provide other documentation to verify in-
come. 
‘‘(iii) FAMILY SIZE.—Unless otherwise 
directed by the Secretary, the borrower 
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must annually certify the borrower’s family 
size. If the borrower fails to certify family 
size, the Secretary assumes a family size of 
one for the applicable year. 
‘‘(B) NOTIFICATIONS.— 
‘‘(i) IN
GENERAL.—Each year that 
the borrower participates in the program 
under this section, the Secretary sends the 
borrower a written notification that pro-
vides the borrower with— 
‘‘(I) the borrower’s monthly pay-
ment amount, as calculated under 
paragraph (1) or (2), and the time pe-
riod during which such monthly pay-
ment amount will apply (annual pay-
ment period); 
‘‘(II) information about the re-
quirement for the borrower to annu-
ally provide the information described 
in subparagraph (A), and an expla-
nation that the borrower will be noti-
fied in advance of the date by which 
the Secretary must receive this infor-
mation; 
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‘‘(III) an explanation of the con-
sequences, as described under sub-
paragraph (E), if the borrower does 
not provide the required information; 
and 
‘‘(IV) information about the bor-
rower’s option to request, at any time 
during the borrower’s annual payment 
period, that the Secretary recalculate 
the 
borrower’s 
monthly 
payment 
amount if the borrower’s financial cir-
cumstances have changed and the in-
come amount that was used to cal-
culate the borrower’s current monthly 
payment no longer reflects the bor-
rower’s current income. 
‘‘(ii) RECALCULATION.—If the Sec-
retary recalculates the borrower’s monthly 
payment amount based on the borrower’s 
request, the Secretary sends the borrower 
a written notification that includes the in-
formation described in this subparagraph. 
‘‘(C) SUBSEQUENT YEARS.— 
‘‘(i) IN GENERAL.—For each year fol-
lowing the first year in which a borrower 
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participating in the plan under this sec-
tion, the Secretary notifies the borrower in 
writing of the requirements of subpara-
graph (A) not later than 60 days and not 
earlier than 90 days prior to the date spec-
ified in clause (ii)(I). 
‘‘(ii) 
CONTENTS.—The 
notification 
under clause (i) shall provide the borrower 
with— 
‘‘(I) the date, no earlier than 35 
days before the end of the borrower’s 
annual payment period, by which the 
Secretary must receive all of the docu-
mentation described in subparagraph 
(A) (annual deadline); and 
‘‘(II) the consequences if the Sec-
retary does not receive the informa-
tion within 10 days following the an-
nual deadline specified in the notice, 
as described under subparagraph (E). 
‘‘(D) NO DOCUMENTATION PROVIDED.—If 
a borrower who is currently repaying under the 
standard repayment plan elects the plan under 
this section but does not provide the docu-
mentation described in subparagraph (A), the 
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borrower remains on such standard repayment 
plan. 
‘‘(E) ALTERNATE REPAYMENT PLAN.— 
‘‘(i) IN GENERAL.—If a borrower who 
is currently repaying under the plan under 
this section elects to participate in such 
program for a subsequent year but the 
Secretary does not receive the documenta-
tion described in subparagraph (A) not 
later than 10 days after the specified an-
nual deadline, the Secretary removes the 
borrower from the plan and places the bor-
rower on an alternative repayment plan 
under 
which 
the 
borrower’s 
required 
monthly payment is the amount necessary 
to repay the borrower’s eligible loans in 
full within the earlier of— 
‘‘(I) 10 years from the date the 
borrower begins repayment under the 
alternative repayment plan; or 
‘‘(II) the ending date of the 20- 
year period as described in paragraph 
(8)(A)(i)(II). 
‘‘(ii) NOTIFICATION.—If the Secretary 
places the borrower on an alternative re-
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payment plan in accordance with clause 
(i), the Secretary sends the borrower a 
written notification informing the borrower 
that— 
‘‘(I) the borrower has been 
placed on an alternative repayment 
plan; 
‘‘(II) the borrower’s monthly pay-
ment amount has been recalculated 
under clause (i); and 
‘‘(III) the borrower may change 
to the standard repayment plan in ac-
cordance with section 455(d)(3). 
‘‘(iii) RETURN TO PROGRAM.—A bor-
rower who has been removed from the plan 
under this section or changes to the stand-
ard repayment plan may return to the plan 
under this section if the borrower provides 
the documentation under subparagraph 
(A), necessary for the Secretary to cal-
culate the borrower’s current monthly pay-
ment amount and the monthly amount the 
borrower would have been required to pay 
under the plan during the period when the 
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borrower was on the alternative repayment 
plan or the standard repayment plan. 
‘‘(iv) ADJUSTMENT OF MONTHLY PAY-
MENT
AMOUNT.—If the Secretary deter-
mines that the total amount of the pay-
ments the borrower was required to make 
while on the alternative repayment plan or 
the standard repayment plan are less than 
the total amount the borrower would have 
been required to make under the program 
during that period, the Secretary will ad-
just the borrower’s monthly payment 
amount to ensure that the difference be-
tween the two amounts is paid in full by 
the end of the 20-year period described in 
paragraph (8)(A)(i)(II). 
‘‘(v) APPLICATION OF LOAN FORGIVE-
NESS.—If the borrower returns to the plan 
under this section, any payments that the 
borrower made under the alternative re-
payment plan after the borrower was re-
moved from the plan shall count towards 
forgiveness under the plan under this sec-
tion. 
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‘‘(vi) PSLF.—Payments made under 
the alternative repayment plan described in 
clause (i) will not count towards public 
service loan forgiveness under section 
455(m). 
‘‘(vii) 
EXCEPTION.—The 
Secretary 
does not take the action described in clause 
(i) if the Secretary receives the documenta-
tion described in subparagraph (A) more 
than 10 days after the specified annual 
deadline, but is able to determine the bor-
rower’s new monthly payment amount be-
fore the end of the borrower’s current an-
nual payment period. 
‘‘(viii) 
MONTHLY
PAYMENT 
AMOUNT.—If the Secretary receives the 
documentation described in subparagraph 
(A) within 10 days of the specified annual 
deadline— 
‘‘(I) the Secretary promptly de-
termines the borrower’s new scheduled 
monthly payment amount and main-
tains the borrower’s current scheduled 
monthly payment amount until the 
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new 
scheduled 
monthly 
payment 
amount is determined; 
‘‘(II) if the new monthly payment 
amount is less than the borrower’s 
previously calculated plan monthly 
payment amount, and the borrower 
made payments at the previously cal-
culated amount after the end of the 
most recent annual payment period— 
‘‘(aa) the Secretary makes 
the appropriate adjustment to 
the borrower’s account; and 
‘‘(bb) unless the borrower 
requests otherwise, the Secretary 
applies 
the 
excess 
payment 
amounts made after the end of 
the most recent annual payment 
period in accordance with the re-
quirements of paragraph (6)(A); 
‘‘(III) if the new monthly pay-
ment amount is equal to or greater 
than the borrower’s previously cal-
culated monthly payment amount, and 
the borrower made payments at the 
previously calculated payment amount 
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after the end of the most recent an-
nual payment period, the Secretary 
does not make any adjustment to the 
borrower’s account; 
‘‘(IV) any payments that the bor-
rower continued to make at the pre-
viously calculated payment amount 
after the end of the prior annual pay-
ment period and before the new 
monthly payment amount is calculated 
are considered to be qualifying pay-
ments for purposes of public service 
loan 
forgiveness 
under 
section 
455(m), provided that the payments 
otherwise meet the requirements de-
scribed in such section 455(m); and 
‘‘(V) the new annual payment pe-
riod begins on the day after the end 
of the most recent annual payment 
period. 
‘‘(8) LOAN FORGIVENESS.— 
‘‘(A) IN GENERAL.— 
‘‘(i) CANCELLATION.—The Secretary 
cancels any remaining outstanding balance 
of principal and accrued interest on a bor-
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rower’s covered Federal Direct Loans that 
are being repaid under the plan under this 
section after— 
‘‘(I) the borrower has made the 
equivalent of 240 qualifying monthly 
payments as defined in subparagraph 
(B); and 
‘‘(II) 20 years have elapsed, be-
ginning on the date determined in ac-
cordance with subparagraph (C). 
‘‘(ii) 
DETERMINATION.—The 
Sec-
retary determines when a borrower has 
met the loan forgiveness requirements 
under clause (i) and does not require the 
borrower to submit a request for loan for-
giveness. 
‘‘(B) QUALIFYING MONTHLY PAYMENT DE-
FINED.— 
‘‘(i) IN
GENERAL.—For purposes of 
this paragraph, a qualifying monthly pay-
ment is— 
‘‘(I) a monthly payment under 
the plan under this section, including 
a monthly payment amount of $0.00, 
as provided under paragraph (2)(C); 
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the date the borrower made a qualifying 
monthly payment on that loan, before the 
date the borrower qualified for the plan 
under this section; 
‘‘(iii) for a borrower who did not make 
a qualifying monthly payment under clause 
(i) or (ii), the date the borrower made a 
payment on the borrower’s covered Federal 
Direct Loans under the plan under this 
section; 
‘‘(iv) if the borrower consolidates the 
borrower’s loans under this title, the date 
the borrower made a qualifying monthly 
payment on the Federal Direct Consolida-
tion Loan; or 
‘‘(v) if the borrower did not make a 
qualifying monthly payment on the loan 
under clauses (i) through (iv), the date the 
borrower made a payment on the loan 
under the plan under this section. 
‘‘(D) NOTIFICATION.— 
‘‘(i) PRIOR
TO
LOAN
CANCELLA-
TION.—Not later than 6 months prior to 
the anticipated date that the borrower will 
meet the forgiveness requirements, the 
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Secretary sends the borrower a written no-
tice that includes— 
‘‘(I) an explanation that the bor-
rower is approaching the date that the 
borrower is expected to meet the re-
quirements to receive loan forgiveness; 
‘‘(II) a reminder that the bor-
rower must continue to make the bor-
rower’s scheduled monthly payments; 
and 
‘‘(III) general information on the 
current treatment of the forgiveness 
amount for tax purposes, and instruc-
tions for the borrower to contact the 
Internal Revenue Service for more in-
formation. 
‘‘(ii) AFTER LOAN CANCELLATION.— 
After determining that a borrower has sat-
isfied the loan forgiveness requirements, 
the Secretary— 
‘‘(I) notifies the borrower that 
the borrower’s obligation on the loans 
is satisfied; 
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‘‘(II) provides the borrower with 
the information described in clause 
(i)(III); and 
‘‘(III) returns to the sender any 
payment received on a loan after loan 
forgiveness has been granted.’’. 
SEC. 4. DISCLOSURES. 
Section 455(p) of the Higher Education Act of 1965 
(20 U.S.C. 1087e(p)) is amended— 
(1) by striking ‘‘Each institution’’ and inserting 
the following: 
‘‘(1) IN GENERAL.—Each institution’’; and 
‘‘(2) CONSULTATION.—The Secretary shall reg-
ularly consult with current and prospective college 
students, family members of such students, institu-
tions of higher education, and other experts to im-
prove the usefulness and relevance of the disclosures 
described in paragraph (1).’’. 
SEC. 5. EXCLUSION OF CERTAIN STUDENT LOAN DIS-
CHARGE BY REASON OF DEATH OR DIS-
ABILITY. 
(a) IN GENERAL.—Section 108(f)(1) of the Internal 
Revenue Code of 1986 is amended— 
(1) by striking the period at the end and insert-
ing ‘‘, or’’, 
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(2) by striking ‘‘if such discharge was pursuant 
to a provision’’ and inserting the following: ‘‘if such 
discharge was pursuant to— 
‘‘(A) a provision’’, and 
(3) by adding at the end the following: 
‘‘(B) section 437(a) of the Higher Edu-
cation Act of 1965.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to discharges of indebtedness after 
the date of the enactment of this Act. 
Æ 
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