Faster Access to Federal Student Aid Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 5368 To provide for secure disclosure of tax-return information to carry out the Higher Education Act of 1965, and for other purposes. IN THE HOUSE OF REPRESENTATIVES DECEMBER 9, 2019 Ms. DELBENE introduced the following bill; which was referred to the Com- mittee on Education and Labor, 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 committee concerned A BILL To provide for secure disclosure of tax-return information to carry out the Higher Education Act of 1965, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Faster Access to Fed- 4 eral Student Aid Act of 2019’’. 5 VerDate Sep 11 2014 02:24 Dec 13, 2019 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H5368.IH H5368 pamtmann on DSKBC07HB2PROD with BILLS 2 •HR 5368 IH SEC. 2. SECURE DISCLOSURE OF TAX-RETURN INFORMA- 1 TION TO CARRY OUT THE HIGHER EDU- 2 CATION ACT OF 1965. 3 (a) IN GENERAL.—Paragraph (13) of section 6103(l) 4 of the Internal Revenue Code of 1986 is amended to read 5 as follows: 6 ‘‘(13) DISCLOSURE OF RETURN INFORMATION 7 TO CARRY OUT THE HIGHER EDUCATION ACT OF 8 1965.— 9 ‘‘(A) APPLICATIONS AND RECERTIFI- 10 CATIONS FOR INCOME-CONTINGENT OR INCOME- 11 BASED REPAYMENT.—The Secretary shall, upon 12 written request from the Secretary of Edu- 13 cation, disclose to any authorized person, only 14 for the purpose of (and to the extent necessary 15 in) determining eligibility for, or repayment ob- 16 ligations under, income-contingent or income- 17 based repayment plans under title IV of the 18 Higher Education Act of 1965 with respect to 19 loans under part D of such title, the following 20 return information from returns (for any tax- 21 able year specified by the Secretary of Edu- 22 cation as relevant to such purpose) of an indi- 23 vidual certified by the Secretary of Education 24 as having provided approval under section 25 494(a)(2) of such Act (as in effect on the date 26 VerDate Sep 11 2014 02:24 Dec 13, 2019 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H5368.IH H5368 pamtmann on DSKBC07HB2PROD with BILLS 3 •HR 5368 IH of enactment of this paragraph) for such disclo- 1 sure: 2 ‘‘(i) Taxpayer identity information. 3 ‘‘(ii) Filing status. 4 ‘‘(iii) Adjusted gross income. 5 ‘‘(iv) Total number of exemptions 6 claimed, if applicable. 7 ‘‘(v) Number of dependents taken into 8 account in determining the credit allowed 9 under section 24. 10 ‘‘(vi) If applicable, the fact that there 11 was no return filed. 12 ‘‘(B) DISCHARGE OF LOAN BASED ON 13 TOTAL AND PERMANENT DISABILITY.—The 14 Secretary shall, upon written request from the 15 Secretary of Education, disclose to any author- 16 ized person, only for the purpose of (and to the 17 extent necessary in) monitoring and reinstating 18 loans under title IV of the Higher Education 19 Act of 1965 that were discharged based on a 20 total and permanent disability (within the 21 meaning of section 437(a) of such Act), the fol- 22 lowing return information from returns (for any 23 taxable year specified by the Secretary of Edu- 24 cation as relevant to such purpose) of an indi- 25 VerDate Sep 11 2014 02:24 Dec 13, 2019 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H5368.IH H5368 pamtmann on DSKBC07HB2PROD with BILLS 4 •HR 5368 IH vidual certified by the Secretary of Education 1 as having provided approval under section 2 494(a)(3) of such Act (as in effect on the date 3 of enactment of this paragraph) for such disclo- 4 sure: 5 ‘‘(i) The return information described 6 in clauses (i), (ii), and (vi) of subpara- 7 graph (A). 8 ‘‘(ii) The return information described 9 in subparagraph (C)(ii). 10 ‘‘(C) FEDERAL STUDENT FINANCIAL 11 AID.—The Secretary shall, upon written request 12 from the Secretary of Education, disclose to 13 any authorized person, only for the purpose of 14 (and to the extent necessary in) determining eli- 15 gibility for, and amount of, Federal student fi- 16 nancial aid under a program authorized under 17 subpart 1 of part A, part C, or part D of title 18 IV of the Higher Education Act of 1965 the 19 following return information from returns (for 20 the taxable year used for purposes of section 21 480(a) of such Act) of an individual certified by 22 the Secretary of Education as having provided 23 approval under section 494(a)(1) of such Act 24 VerDate Sep 11 2014 02:24 Dec 13, 2019 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H5368.IH H5368 pamtmann on DSKBC07HB2PROD with BILLS 5 •HR 5368 IH (as in effect on the date of enactment of this 1 paragraph) for such disclosure: 2 ‘‘(i) Return information described in 3 clauses (i) through (vi) of subparagraph 4 (A). 5 ‘‘(ii) The amount of any net earnings 6 from self-employment (as defined in sec- 7 tion 1402(a)), wages (as defined in section 8 3121(a) or 3401(a)), and taxable income 9 from a farming business (as defined in sec- 10 tion 236A(e)(4)). 11 ‘‘(iii) Amount of total income tax. 12 ‘‘(iv) Amount of any credit allowed 13 under section 25A. 14 ‘‘(v) Amount of individual retirement 15 account distributions not included in ad- 16 justed gross income. 17 ‘‘(vi) Amount of individual retirement 18 account contributions and payments to 19 self-employed SEP, Keogh, and other 20 qualified plans which were deducted from 21 income. 22 ‘‘(vii) Amount of tax-exempt interest 23 received. 24 VerDate Sep 11 2014 02:24 Dec 13, 2019 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H5368.IH H5368 pamtmann on DSKBC07HB2PROD with BILLS 6 •HR 5368 IH ‘‘(viii) Amounts from retirement pen- 1 sions and annuities not included in ad- 2 justed gross income. 3 ‘‘(ix) If applicable, the fact that any 4 of the following schedules (or equivalent 5 successor schedules) were filed with the re- 6 turn: 7 ‘‘(I) Schedule A. 8 ‘‘(II) Schedule B. 9 ‘‘(III) Schedule D. 10 ‘‘(IV) Schedule E. 11 ‘‘(V) Schedule F. 12 ‘‘(VI) Schedule H. 13 ‘‘(x) If applicable, the amount re- 14 ported on Schedule C (or an equivalent 15 successor schedule) as net profit or loss. 16 ‘‘(D) ADDITIONAL USES OF DISCLOSED IN- 17 FORMATION.— 18 ‘‘(i) IN GENERAL.—In addition to the 19 purposes for which information is disclosed 20 under subparagraphs (A), (B), and (C), re- 21 turn information so disclosed may be used 22 by an authorized person, with respect to 23 income-contingent or income-based repay- 24 ment plans, awards of Federal student fi- 25 VerDate Sep 11 2014 02:24 Dec 13, 2019 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H5368.IH H5368 pamtmann on DSKBC07HB2PROD with BILLS 7 •HR 5368 IH nancial aid under a program authorized 1 under subpart 1 of part A, part C, or part 2 D of title IV of the Higher Education Act 3 of 1965, and discharges of loans based on 4 a total and permanent disability (within 5 the meaning of section 437(a) of such 6 Act), for purposes of— 7 ‘‘(I) reducing the net cost of im- 8 proper payments under such plans, re- 9 lating to such disbursements, or relat- 10 ing to such discharges, 11 ‘‘(II) oversight activities by the 12 Office of Inspector General of the De- 13 partment of Education as authorized 14 by the Inspector General Act of 1978, 15 and 16 ‘‘(III) conducting analyses and 17 forecasts for estimating costs related 18 to such plans, disbursements, or dis- 19 charges. 20 ‘‘(ii) LIMITATION.—The purposes de- 21 scribed in clause (i) shall not include the 22 conduct of criminal investigations or pros- 23 ecutions. 24 VerDate Sep 11 2014 02:24 Dec 13, 2019 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H5368.IH H5368 pamtmann on DSKBC07HB2PROD with BILLS 8 •HR 5368 IH ‘‘(iii) REDISCLOSURE TO INSTITU- 1 TIONS OF HIGHER EDUCATION, STATE 2 HIGHER EDUCATION AGENCIES, AND DES- 3 IGNATED SCHOLARSHIP ORGANIZATIONS.— 4 Authorized persons may redisclose return 5 information received under subparagraph 6 (C), solely for the use in the application, 7 award, and administration of financial aid 8 awarded by the Federal Government or 9 awarded by a person described in sub- 10 clause (I), (II), or (III), to the following 11 persons: 12 ‘‘(I) An institution of higher edu- 13 cation participating in a program 14 under subpart 1 of part A, part C, or 15 part D of title IV of the Higher Edu- 16 cation Act of 1965. 17 ‘‘(II) A State higher education 18 agency. 19 ‘‘(III) A scholarship organization 20 which is an entity designated (prior to 21 the date of the enactment of this 22 clause) by the Secretary of Education 23 under section 483(a)(3)(E) of such 24 Act. 25 VerDate Sep 11 2014 02:24 Dec 13, 2019 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H5368.IH H5368 pamtmann on DSKBC07HB2PROD with BILLS 9 •HR 5368 IH This clause shall only apply to the extent 1 that the taxpayer with respect to whom the 2 return information relates provides written 3 consent for such redisclosure to the Sec- 4 retary of Education. 5 ‘‘(E) AUTHORIZED PERSON.—For pur- 6 poses of this paragraph, the term ‘authorized 7 person’ means, with respect to information dis- 8 closed under subparagraph (A), (B), or (C), 9 any person who— 10 ‘‘(i) is an officer, employee, or con- 11 tractor, of the Department of Education, 12 and 13 ‘‘(ii) is specifically authorized and des- 14 ignated by the Secretary of Education for 15 purposes of such subparagraph (applied 16 separately with respect to each such sub- 17 paragraph). 18 ‘‘(F) JOINT RETURNS.—In the case of a 19 joint return, any disclosure authorized under 20 subparagraph (A), (B), or (C) with respect to 21 an individual shall be treated for purposes of 22 this paragraph as applying with respect to the 23 taxpayer.’’. 24 VerDate Sep 11 2014 02:24 Dec 13, 2019 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H5368.IH H5368 pamtmann on DSKBC07HB2PROD with BILLS 10 •HR 5368 IH (b) CONFIDENTIALITY OF RETURN INFORMATION.— 1 Section 6103(a)(3) of such Code is amended by inserting 2 ‘‘, (13)’’ after ‘‘(12)’’. 3 (c) CONFORMING AMENDMENTS.— 4 (1) Section 6103(p)(3)(A) of such Code is 5 amended by striking ‘‘(13)’’. 6 (2) Section 6103(p)(4) of such Code is amend- 7 ed by inserting ‘‘, (13)’’ after ‘‘(l)(10)’’ each place 8 it appears. 9 (d) EFFECTIVE DATE.—The amendments made by 10 this section shall apply to disclosures made after the Sec- 11 retary of the Treasury (or the Secretary’s designee) sub- 12 mits a written notification to the Committee on Ways and 13 Means of the House of Representatives and the Committee 14 on Finance of the Senate that the Secretary of Education 15 has demonstrated a readiness to comply with the stand- 16 ards outlined in Internal Revenue Service Publication 17 1075 with respect to return information received under 18 section 6103(l)(13) of the Internal Revenue Code of 1986. 19 (e) REQUIREMENT TO DESIGNATE THE INSPECTOR 20 GENERAL OF THE DEPARTMENT OF EDUCATION AS AN 21 AUTHORIZED PERSON.—The Secretary of Education shall 22 authorize and designate the Inspector General of the De- 23 partment of Education as an authorized person under sub- 24 paragraph (E)(ii) of section 6103(l)(13) of the Internal 25 VerDate Sep 11 2014 23:29 Dec 13, 2019 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H5368.IH H5368 pamtmann on DSKBC07HB2PROD with BILLS 11 •HR 5368 IH Revenue Code of 1986 for purposes of subparagraphs (A), 1 (B), and (C) of such section. 2 (f) REPORT TO TREASURY.—The Secretary of Edu- 3 cation shall annually submit a written report to the Sec- 4 retary of the Treasury— 5 (1) regarding redisclosures of return informa- 6 tion under subparagraph (D)(iii) of section 7 6103(l)(13) of the Internal Revenue Code of 1986, 8 including the number of such redisclosures; and 9 (2) regarding any unauthorized use, access, or 10 disclosure of return information disclosed under such 11 section. 12 (g) REPORT TO CONGRESS.—The Secretary of the 13 Treasury (or the Secretary’s designee) shall annually sub- 14 mit a written report to Congress regarding disclosures 15 under section 6103(l)(13) of the Internal Revenue Code 16 of 1986, including information provided to the Secretary 17 under subsection (f). 18 SEC. 3. AUTOMATIC RECERTIFICATION OF INCOME. 19 (a) INCOME-CONTINGENT REPAYMENT.— 20 (1) IN GENERAL.—Section 455(e) of the Higher 21 Education Act of 1965 (20 U.S.C. 1087e(e)) is 22 amended by adding at the end the following: 23 ‘‘(8) AUTOMATIC RECERTIFICATION.— 24 VerDate Sep 11 2014 02:24 Dec 13, 2019 Jkt 099200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H5368.IH H5368 pamtmann on DSKBC07HB2PROD with BILLS 12 •HR 5368 IH ‘‘(A) IN GENERAL.—The Secretary shall 1 establish and implement, with respect to any 2 borrower described in subparagraph (B), proce- 3 dures to— 4 ‘‘(i) use return information disclosed 5 under section 6103(l)(13) of the Internal 6 Revenue Code of 1986, pursuant to ap- 7 proval provided under section 494, to de- 8 termine the repayment obligation of the 9 borrower without further action by the bor- 10 rower; 11 ‘‘(ii) allow the borrower (or the spouse 12 of the borrower), at any time, to opt out 13 of disclosure under such section 14 6103(l)(13) and instead provide such infor- 15 mation as the Secretary may require to de- 16 termine the repayment obligation of the 17 borrower (or withdraw from the repayment 18 plan under this subsection); and 19 ‘‘(iii) provide the borrower with an op- 20 portunity to update the return information 21 so disclosed before the determination of the 22 repayment obligation of the borrower. 23 ‘‘(B) APPLICABILITY.—Subparagraph (A) 24 shall apply to each borrower of a loan made 25 VerDate Sep 11 2014 02:24 Dec 13, 2019 Jkt 099200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\H5368.IH H5368 pamtmann on DSKBC07HB2PROD with BILLS 13 •HR 5368 IH under this part who, on or after the date on 1 which the Secretary establishes procedures 2 under such subparagraph— 3 ‘‘(i) selects, or is required to repay 4 such loan pursuant to, an income-contin- 5 gent repayment plan; or 6 ‘‘(ii) recertifies income or family size 7 under such plan.’’. 8 (2) CONFORMING AMENDMENT.—Section 9 455(e)(6) of the Higher Education Act of 1965 (20 10 U.S.C. 1087e(e)(6)) is amended— 11 (A) by striking ‘‘including notification of 12 such borrower’’ and all that follows through 13 ‘‘that if a borrower’’ and inserting ‘‘including 14 notification of such borrower, that if a bor- 15 rower’’; and 16 (B) by striking ‘‘as determined using the 17 information described in subparagraph (A), or 18 the alternative documentation described in 19 paragra [Text truncated for display. 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