An Act amending the act of March 4, 1971 (P.L.6, No.2), known as the Tax Reform Code of 1971, in personal income tax, further providing for classes of income.

PRINTER'S NO. 843
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 813
Session of
2025
INTRODUCED BY O'MARA, CEPHAS, KHAN, PIELLI, SANCHEZ, HANBIDGE,
HOWARD, HILL-EVANS, CIRESI, SCHLOSSBERG, FRANKEL, HOHENSTEIN,
McANDREW, FREEMAN, BELLMON, ISAACSON, FLEMING, OTTEN,
KENYATTA, CERRATO, GREEN, BURGOS, GIRAL, SHUSTERMAN, WAXMAN,
MAYES, PROBST, T. DAVIS, PASHINSKI, CEPEDA-FREYTIZ, MERSKI,
CURRY AND BOYD, MARCH 5, 2025
REFERRED TO COMMITTEE ON EDUCATION, MARCH 5, 2025
AN ACT
Amending the act of March 4, 1971 (P.L.6, No.2), entitled "An
act relating to tax reform and State taxation by codifying
and enumerating certain subjects of taxation and imposing
taxes thereon; providing procedures for the payment,
collection, administration and enforcement thereof; providing
for tax credits in certain cases; conferring powers and
imposing duties upon the Department of Revenue, certain
employers, fiduciaries, individuals, persons, corporations
and other entities; prescribing crimes, offenses and
penalties," in personal income tax, further providing for
classes of income.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Section 303 of the act of March 4, 1971 (P.L.6,
No.2), known as the Tax Reform Code of 1971, is amended by
adding a subsection to read:
Section 303. Classes of Income.--* * *
(a.13) The following apply:
(1) The following shall not be subject to tax under this
article:
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(i) The discharge of an eligible student loan under a
qualified loan forgiveness program.
(ii) Amounts paid or incurred by an employer of an employe
for educational assistance provided to an employe that are
excludable under section 127 of the Internal Revenue Code of
1986 (26 U.S.C. § 127).
(2) For the purposes of this subsection:
(i) "Eligible student loan" shall mean a student loan issued
pursuant to 20 U.S.C. Ch. 28 Subch. IV (relating to student
assistance).
(ii) "Qualified loan forgiveness program" means a loan
forgiveness program established under 34 CFR Subt. B Ch. VI
(relating to Office of Postsecondary Education, Department of
Education).
* * *
Section 2. The addition of section 303(a.13) of the act
shall apply to taxable years beginning after December 31, 2025.
Section 3. This act shall take effect immediately.
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