- Joined
- Oct 9, 2010
- Messages
- 75
- Reaction score
- 6
After doing a lot of digging around, I've found a few sources that appear to confirm a continued exemption from income tax liability for HPSP and NHSC tuition costs (however, the living stipends are still considered taxable income).
Here is an article written by a tax lawyer that describes which provisions are extended in connection with the House and Senate bill passed a few days ago.
http://www.journalofaccountancy.com/News/20137097.htm
Here is the section that matters to those of us concerned with the scholarships
"Permanent extensions
Various temporary tax provisions enacted as part of EGTRRA were made permanent. These include:
Marriage penalty relief (i.e., the increased size of the 15% rate bracket (Sec. 1(f)(8)) and increased standard deduction for married taxpayers filing jointly (Sec. 63(c)(2));
The liberalized child and dependent care credit rules (allowing the credit to be calculated based on up to $3,000 of expenses for one dependent or up to $6,000 for more than one) (Sec. 21);
Expanded adoption credit (Sec. 23) and adoption-assistance program (Sec. 137) amounts;
The exclusion for National Health Service Corps and Armed Forces Health Professions scholarships (Sec. 117(c)(2));
The exclusion for employer-provided educational assistance (Sec. 127);
The enhanced rules for student loan deductions introduced by EGTRRA (Sec. 221);
The higher contribution amount and other EGTRRA changes to Coverdell education savings accounts (Sec. 530);
The employer-provided child care credit (Sec. 45F);
Special treatment of tax-exempt bonds for education facilities (Sec 142(a)(13));
Repeal of the collapsible corporation rules (Sec. 341);
Special rates for accumulated earnings tax and personal holding company tax (Secs. 531 and 541); and
Modified tax treatment for electing Alaska Native Settlement Trusts (Sec. 646)."
I got in touch with the author of the article about where to find verification for this claim, asking him this, "I came across the article (http://www.journalofaccountancy.com/News/20137097.htm) you published yesterday on the Journal of Accountancy website and I had a question about the source for the permanent tax extensions. I browsed through the copy of the bill passed by the House and Senate two days ago and didn't see any mention of Section 117 (c)(2) which relates to the income tax exemption for the scholarship. I would appreciate any input you might be able to share on this issue."
This was the author's reply, "Thanks for your question. The Sec. 117(c)(2) exclusions are not specifically mentioned in the act (as you note), but they are made permanent because they were enacted as part of the Economic Growth and Tax Relief Reconciliation Act of 2001, and the changes in the 2001 act were made permanent by section 101 of the fiscal cliff bill."
Another source that also makes the same claim can be found here http://tax.cchgroup.com/downloads/fi...ation/ATPR.pdf on the 8th page of the document.
If anyone else has any additional information, please share. I don't want to count chickens before they hatch but I feel like things are looking good.
Here is an article written by a tax lawyer that describes which provisions are extended in connection with the House and Senate bill passed a few days ago.
http://www.journalofaccountancy.com/News/20137097.htm
Here is the section that matters to those of us concerned with the scholarships
"Permanent extensions
Various temporary tax provisions enacted as part of EGTRRA were made permanent. These include:
Marriage penalty relief (i.e., the increased size of the 15% rate bracket (Sec. 1(f)(8)) and increased standard deduction for married taxpayers filing jointly (Sec. 63(c)(2));
The liberalized child and dependent care credit rules (allowing the credit to be calculated based on up to $3,000 of expenses for one dependent or up to $6,000 for more than one) (Sec. 21);
Expanded adoption credit (Sec. 23) and adoption-assistance program (Sec. 137) amounts;
The exclusion for National Health Service Corps and Armed Forces Health Professions scholarships (Sec. 117(c)(2));
The exclusion for employer-provided educational assistance (Sec. 127);
The enhanced rules for student loan deductions introduced by EGTRRA (Sec. 221);
The higher contribution amount and other EGTRRA changes to Coverdell education savings accounts (Sec. 530);
The employer-provided child care credit (Sec. 45F);
Special treatment of tax-exempt bonds for education facilities (Sec 142(a)(13));
Repeal of the collapsible corporation rules (Sec. 341);
Special rates for accumulated earnings tax and personal holding company tax (Secs. 531 and 541); and
Modified tax treatment for electing Alaska Native Settlement Trusts (Sec. 646)."
I got in touch with the author of the article about where to find verification for this claim, asking him this, "I came across the article (http://www.journalofaccountancy.com/News/20137097.htm) you published yesterday on the Journal of Accountancy website and I had a question about the source for the permanent tax extensions. I browsed through the copy of the bill passed by the House and Senate two days ago and didn't see any mention of Section 117 (c)(2) which relates to the income tax exemption for the scholarship. I would appreciate any input you might be able to share on this issue."
This was the author's reply, "Thanks for your question. The Sec. 117(c)(2) exclusions are not specifically mentioned in the act (as you note), but they are made permanent because they were enacted as part of the Economic Growth and Tax Relief Reconciliation Act of 2001, and the changes in the 2001 act were made permanent by section 101 of the fiscal cliff bill."
Another source that also makes the same claim can be found here http://tax.cchgroup.com/downloads/fi...ation/ATPR.pdf on the 8th page of the document.
If anyone else has any additional information, please share. I don't want to count chickens before they hatch but I feel like things are looking good.
