Page:United States Statutes at Large Volume 90 Part 2.djvu/443

 PUBLIC LAW 94-455—OCT. 4, 1976 ,.>

90 STAT. 1911

(iii) by striking out the period at the end of subparagraph (B) and inserting in lieu thereof ", and", and (iv) by adding at the end thereof the following new subparagraph: "(C) if a credit is allowed against such tax for State or local sales tax in accordance with paragraph (4)(B), the . j -. liability for tax is increased by the increase in such liability which would result from including as an item of income an amount equal to the amount of his deduction under section 164(a)(4) for such sales tax." (B) FURTHER PERMITTED ADJUSTMENTS.—Section 6362(c) 26 USC 6362. (4) (relating to further permitted adjustments) is amended to read as follows: "(4) FURTHER PERMITTED ADJUSTMENTS.—A tax which otherwise meets the requirements of paragraphs (1) and (2) shall not be deemed to fail to meet such requirements solely because it provides for one or both of the following adjustments: "(A) A credit determined under rules prescribed by the Secretary is allowed against such tax for income tax paid to -^.,,,, ^ _ ^ another State or a political subdivision thereof. '" ^5,," "(B) A credit is allowed against such tax for all or a portion of any general sales tax imposed by the same State or a political subdivision thereof with respect to sales to the taxpayer or his dependents."

(c) PROHIBITION ON CHARGES FOR FEDERAL COLLECTION OF STATE INCOME TAXES.—Section 6361(a) (relating to general rules for Fed-

26 USC 6361.

eral collection and administration of State individual income taxes) is amended by inserting, after the first sentence thereof, the following: "No fee or other charge shall be imposed upon any State for the collection or administration of the qualified State individual income taxes of such State or any other State.". (d) EFFECTIVE DATE.—The amendments made by this section shall 26 USC 6361 take effect on the date of the enactment of this Act. note. SEC. 2117. CANCELLATION OF CERTAIN STUDENT LOANS.

26 USC 61 note.

(a) IN GENERAL.—In the case of an individual, no amount shall be included in gross income for purposes of section 61 of the Internal Revenue Code of 1954 by reason of the discharge of all or part of the indebtedness of the individual under a student loan if such discharge was pursuant to a provision of such loan under which all or part of the indebtedness of the individual would be discharged if the individual worked for a certain period of time in certain geographical areas or for certain classes of employers. (b) STUDENT LOAN.—For purposes of this section the term "student "Student loan." loan" means any loan to an individual to assist the individual in attending an educational organization described in section 170(b)(1) (A) (ii) of such Code— (1) by the United States, or an instrumentality or agency thereof, or a State, territory, or possession of the United States, or any political subdivision thereof, or the District of Columbia, or (2)by any such educational organization pursuant to an agrees ment with the United States, or an instrumentality or agency thereof, or a State, territory, or possession of the United States, or any political subdivision thereof, or the District of Columbia under which the funds from which the loan was made were' provided to such educational organization. '.••.•v\-'-

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