DesJarlais bill targets debt left by service members

photo U.S. Rep. Scott DesJarlais, R-Tenn.
Arkansas-Tennessee Live Blog

Marine Lance Cpl. Andrew Carpenter wanted a life after serving in Afghanistan, so he attended community college, took some classes at Middle Tennessee State University and signed off on a $20,000 student loan to pay for his studies.

But a sniper in Helmand province ended Carpenter's plans. The 27-year-old Columbia, Tenn., native died last year of combat injuries long before completing his mass communications degree at MTSU.

The private company that lent money to Carpenter forgave the unpaid debt. The Internal Revenue Service wasn't so kind.

Just like forgiven debt on credit cards and personal loans, the IRS classifies waived student debt as taxable income. For the Carpenters, that translated to about $2,000 in taxes after the death of their Marine.

"It made no sense," said Cindy Carpenter, who co-signed her son's loan. "It's a problem a lot of people don't know anything about, and it affects people who die for our country."

Enter U.S. Rep. Scott DesJarlais, a Jasper Republican who's expected to take a critical step toward fixing the problem for future Andrew Carpenters.

Up for a House vote this afternoon, DesJarlais' Andrew P. Carpenter Tax Act would prohibit the IRS from collecting taxes on forgiven student loans held by veterans whose active-duty injuries led to death.

The bill is retroactive to Oct. 7, 2001 -- the start of the war in Afghanistan. Families who already have paid taxes on such loans would be eligible for a refund, according to DesJarlais' office.

A freshman congressman seeking re-election, DesJarlais said the bill represents an easy way to fix a baffling tax code issue. It's the first of DesJarlais' five bills to get a standalone House vote.

"Committee chairmen, the majority leaders, veterans in Congress -- everybody felt this was the right thing to do," he said.

An aide to state Sen. Eric Stewart, DesJarlais' Democratic opponent, did not respond to a request for comment on the bill.

DesJarlais spokesman Robert Jameson said it's assumed the bill will pass the House easily, but it's unclear when the Senate will take it up.

"We are working with several Senate offices for co-sponsorship," Jameson said.

Federal student loans already are forgiven when a veteran dies, but private loan companies have the option to collect or forgive.

"I don't think you can make private companies [forgive debt]," DesJarlais said, "but I think a lot of them will do the right thing. It's the patriotic thing to do."

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