U.S. Reps. Adam Kinzinger (R-Channahon) and Stephanie Murphy (D-Fla.) introduced H.R. 2983, the Readily Ending Debt Under Corporate Engagement (REDUCE) Act.
The bipartisan legislation will allow employees to take full advantage of the tax-free employer payment options created in the CARES Act and continue to maximize student loan interest deductions each year. Currently, the deduction is reduced by the amount of what the employer pays on the loan. But the REDUCE Act would create an opportunity to help borrowers pay back their loans quicker, Kinzinger said.
“Currently, Americans collectively owe more than $1.6 trillion in student loan debt. This growing issue will continue if we do not make practical changes to solve it now,” Kinzinger said in a press release. “I’m proud to take on this critical issue with my colleague Rep. Murphy. 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.”
The full text of H.R. 2983 can be found online here.