Floor Statement on The Andrew P. Carpenter Tax Act

Sep 19, 2012

Mr. Chairman

This bill addresses an issue that does need consideration.

Lt. Carpenter died serving his nation.

He possessed outstanding student loans.  The lender waived repayment by his parents who were obligated on the loans.  Present policy would require his parents to pay taxes on the value of that repayment.

The Congress must act to ensure that the families of these brave men and women do not face undue hardship in the face of tragedy.  I don’t think any member would disagree with me.

Unfortunately, this bill has not been the subject of a single hearing or markup in the Committee of jurisdiction, Ways and Means.

As a result, the bill has no legislative history to which agencies or taxpayers can turn to answer any questions that should arise.

While technical changes were made to this bill from the bill’s introduction to its consideration on the Floor today, the text still leaves many questions unanswered, including deficiencies with respect to definitions of terms in the bill and as to scope.  

The tax treatment of debt forgiveness is a broad and important issue, and while this bill will cover the tax treatment of one class of debt for one class of taxpayers, I think many in this body might argue that other classes of taxpayers should also be able to receive such tax treatment, [like foreign service officers that are killed during their service.]  

In the absence of regular order on this bill, but recognizing the need to address the impact of our tax laws on those who have served our nation and their families, I believe that we should pass this legislation over to the Senate, with the expectation that it will address outstanding technical and coverage issues.