U.S. Rep. Adam Kinzinger (R-IL) recently sponsored bipartisan legislation that would allow the deduction for interest paid on student loans without reduction for employer educational assistance.
“Currently, Americans collectively owe more than $1.6 trillion in student loan debt,” Rep. Kinzinger said on May 6. “This growing issue will continue if we do not make practical changes to solve it now.”
Last week Rep. Kinzinger introduced the Readily Ending Debt Under Corporate Engagement (REDUCE) Act, H.R. 2983, with bill cosponsor U.S. Rep. Stephanie Murphy (D-FL) to allow employees to take full advantage of the tax-free employer payment options created in the CARES Act and continue to maximize their student loan interest deduction each year, according to a bill summary provided by Rep. Kinzinger’s office.
Currently, the deduction is reduced by the amount of what the employer pays on the loan, the summary says, but if enacted, H.R. 2983 would help borrowers pay back their loans quicker.
“The REDUCE Act will provide a simple adjustment to the tax code providing employees with a stronger tool to pay off their student loan debt faster,” said Rep. Kinzinger.
Rep. Murphy noted that almost 45 million Americans — including 2.6 million Floridians — have student loan debt. “I’m proud to co-lead this bipartisan bill with Congressman Kinzinger to give student loan borrowers another tool to alleviate this burden,” she said.
H.R. 2983 has been referred for consideration to the U.S. House Ways and Means Committee.