The bill would ensure AmeriCorps alumni are able to collect the full value of their Segal AmeriCorps Education Award
Senators Michael Bennet (D-CO) and Johnny Isakson (R-GA) introduced S. 1042, The Segal AmeriCorps Education Award Enhancement Act, legislation that would exclude the Segal AmeriCorps Education Award from federal taxation. This bipartisan bill is the Senate companion to H.R. 1602, The Segal AmeriCorps Education Award Tax Relief Act of 2017, which Representative John Lewis (D-GA) introduced in the House of Representatives earlier this year.
Currently, under federal law, the Segal AmeriCorps Education Award is treated differently than other education awards and scholarships designed with a similar purpose. The Segal AmeriCorps Education Award is considered taxable income and recipients are prohibited from withholding a portion of the award to cover any resulting taxes. As a result, the tax creates a financial burden for AmeriCorps alumni, discouraging some from using their award and forcing others to delay their education plans.
The legislation introduced by Senators Bennet and Isakson, as well as the bill introduced by Representative Lewis, would exclude the Segal AmeriCorps Education Award as gross income under the federal tax code, ensuring the earned benefit remains a compelling incentive to serve and a tool for making higher education more affordable for AmeriCorps alumni.
To view a joint press release from Senators Bennet and Isakson on S. 1042, click here.
I’m proud to join you to encourage public service & remove an unfair tax burden for recipients of this award. https://t.co/dfLmGP4M7C
— Johnny Isakson (@SenatorIsakson) May 5, 2017
— Michael F. Bennet (@SenBennetCO) May 5, 2017