Costello, Roskam, Kind, and Pingree Introduce the Stop Taxing Death and Disability Act
Washington, D.C. – U.S. Rep. Ryan Costello (R-PA) joined a bipartisan group of his colleagues today to introduce the Stop Taxing Death and Disability Act. The bill, which previously passed unanimously through the Ways & Means Committee in the 114th Congress, would eliminate a harsh tax penalty levied against families that accept student loan forgiveness following the death or permanent disability of a child. Rep. Costello was joined by Reps. Peter J. Roskam (R-IL), Ron Kind (D-WI), and Chellie Pingree (D-ME) in introducing the legislation.
“It is unacceptable that the IRS would tax grieving families on the forgiven student loans of a child who has passed away or suffered a permanent disability, which is why I’m proud to introduce legislation to end this tax penalty and hope to see it move forward quickly,” said Rep. Ryan Costello (PA-06).
The federal government forgives certain student loan debt accrued by individuals who die or suffer permanent disability. The IRS, however, treats the loan forgiveness as income – it becomes a taxable event. Grieving families, already dealing with the emotional and financial burdens of a tragic event, are slapped with a tax bill that could reach into the tens of thousands of dollars.
In the U.S. Senate, a companion bill has been introduced by Senators Rob Portman (R-OH), Chris Coons (D-DE), and Angus King (I-ME).