Sec. 4. Automatic recertification of income
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Section 455(e) of the Higher Education Act of 1965 ( 20 U.S.C. 1087e(e) ) is amended— in paragraph (3)— by striking does not reasonably reflect the borrower's current income and inserting whose income has decreased relative to the adjusted gross income available to the Secretary ; and by inserting , consistent with the procedures established under paragraph (8)(B)(iv) before the period at the end; and by adding at the end the following: In this paragraph, the term covered loan has the meaning given the term in subsection (d)(8).
Beginning as soon as the Secretary determines practicable after the Secretary finalizes the procedures under section 5 of the Streamlining Income-driven, Manageable Payments on Loans for Education Act , but not later than 2 years after the date of enactment of such Act, the Secretary shall establish and implement, with respect to any borrower described in subparagraph (C), procedures to— obtain (for each year of repayment and without further action by the borrower) such information as is reasonably necessary regarding the income of such borrower (and the borrower’s spouse, if applicable), for the purpose of determining the repayment obligation of the borrower for such year, including information with respect to the borrower’s family size in accordance with the procedures under section 5 of the Streamlining Income-driven, Manageable Payments on Loans for Education Act , subject to clause (ii); allow the borrower, at any time, to opt out of clause
(i)and prevent the Secretary from obtaining information under such clause without further action by the borrower; provide the borrower with an opportunity to update the information obtained under clause
(i)before the determination of the annual repayment obligation of the borrower; and in the case of a borrower for whom adjusted gross income is unavailable— if the borrower has selected to repay the covered loans of such borrower pursuant to an income contingent repayment plan that defines discretionary income in such a manner that an individual not required under section 6012(a)(1) of the Internal Revenue Code of 1986 to file a return with respect to income taxes imposed by subtitle A of such Code may have a calculated monthly payment greater than $0, the borrower will be required to provide the Secretary with other documentation of income satisfactory to the Secretary, which documentation the Secretary may use to determine an appropriate repayment schedule; or if the borrower has selected to repay such loans pursuant to an income contingent repayment that is not described in subclause (I), the borrower will not be required to provide the Secretary with such other documentation of income, and the borrower will have a calculated monthly payment of $0. Subparagraph
(B)shall apply to each borrower of a covered loan who, on or after the date on which the Secretary establishes procedures under such subparagraph— selects, or for whom the Secretary selects under subparagraph
(C)or
(D)of paragraph
(6)or paragraph (7)(C) of subsection (d), or section 428(m)(1), an income contingent repayment plan; or recertifies income and family size under such plan. Returns and return information (as defined in section 6103 of the Internal Revenue Code of 1986) may be obtained under subparagraph (B)(i) only to the extent authorized by section 6103(l)(13) of such Code. The procedures established by the Secretary under this paragraph shall be consistent with the requirements of paragraphs
(1)through (7), except as otherwise provided in this paragraph. . Section 493C(c) of the Higher Education Act of 1965 ( 20 U.S.C. 1098e(c) ) is amended— by striking The Secretary shall establish and inserting the following: The Secretary shall establish ; by striking The Secretary shall consider and inserting the following: The Secretary shall— consider ; and by striking 428C(b)(1)(E). and inserting the following: 428C(b)(1)(E); and beginning as soon as the Secretary determines practicable after the Secretary finalizes the procedures under section 5 of the Streamlining Income-driven, Manageable Payments on Loans for Education Act , but not later than 2 years after the date of enactment of such Act, carry out, with respect to borrowers of any covered loan (as defined in section 455(d)(8)), procedures for income-based repayment plans that are equivalent to the procedures carried out under section 455(e)(8) with respect to income contingent repayment plans. .
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