Wicker, Merkley, Colleagues Seek to Lower Tax Burden for Public Service Nurses

Miss. Senator Joins Colleagues on Bipartisan Legislation Reforming Nursing Student Loans

January 15, 2022

WASHINGTON – U.S. Senators Roger Wicker, R-Miss., Jeff Merkley, D-Ore., John Boozman, R-Ark., and Patty Murray, D-Wash., introduced the Nurse Corps Tax Parity Act, legislation which would ensure that nurses in the federal Nurse Corps do not need to pay income tax on their student loan forgiveness and scholarships.

This legislation is also supported by Senators Kirsten Gillibrand, D-NY., Debbie Stabenow, D-Mich., and Amy Klobuchar, D-Minn.

“Nurses have been on the frontlines of the coronavirus pandemic for more than two years now,” said Wicker. “The nationwide shortage of nurses has made clear just how vital having skilled and hardworking health care professionals is to keeping our country running. I am glad to join Senator Merkley to introduce a measure that would expand opportunity and affordability for America’s future nurses by removing the tax for Nurse Corps student loan repayments.”

“Frontline nurses have been the driving force getting our communities through this ongoing pandemic,” said Merkley. “These individuals continue to sacrifice their health and safety for the well-being of our country’s communities. It’s terrible public policy and frankly offensive that nurses are singled out for extra taxation as compared to other health professionals and it’s got to end.”

“Medical professionals are experiencing tremendous challenges right now,” said Boozman. Encouraging nurses to bring their expertise to underserved communities is necessary to better serve patients where they live. Our legislation is a common sense approach to improving incentives for these health care heroes so rural populations will have access to the care they need.”

“Nurses across the country have been on the frontlines of this pandemic and providing lifesaving care for patients. But COVID-19 has burnt out so many people, and stretched our health care workforce to the breaking point,” said Murray. “Our country needs more nurses, which is why I am cosponsoring this bill to support our frontline health care workforce by putting more money in the pockets of people participating in a program that brings nursing professionals to underserved communities. I’m proud to join Senator Merkley in introducing the Nurse Corps Tax Parity Act, and I am going to keep pushing to pass this bill and take other meaningful steps to support our health care workers.”

The National Health Service Corps (NHSC) and the Nurse Corps are programs administered by the Health Resources and Services Administration (HRSA) aimed at delivering critical health care services in underserved areas. Both corps programs offer scholarships and loan repayment for health care providers in exchange for service in these areas. Though the NHSC and Nurse Corps tout similar missions and programming offerings, NHSC scholarships and loan forgiveness are not subject to federal income tax, while those from Nurse Corps are.

Public health sector leaders celebrated the Wicker-led legislation.

“The vital Nurse Corps program helps many people, including 2.4 million Americans in rural and underserved communities, get the high-quality care that they need," said American Nurses Association President Dr. Ernest Grant, PhD, RN, FAAN. "By removing the tax on scholarships and loans provided by the Nurse Corps, this bill will bring it in line with other programs like the National Health Service Corps, which have enabled other health care professionals to work in high-need areas. I want to thank Senators Merkley and Wicker for their efforts on this legislation, which will enable more nurses to provide care to those who need it most."

"From scholarship opportunities for nursing students to loan repayment for those already working in critical shortage facilities or at schools of nursing as nurse faculty, the Nurse Corps programs help increase access to healthcare service for those communities most in need," said Dr. Deborah Trautman, President and CEO of the American Association of Colleges of Nursing. "We recognize the vital role our current and future nursing workforce has in our healthcare system, especially during this public health emergency, and look forward to working with Congress to move this bipartisan effort forward.”

Without an exemption for the Nurse Corps, scholarships or loan repayments that can be considered compensation for services are taxable. To ensure parity in tax status between the NHSC and Nurse Corps, the Nurse Corps Tax Parity Act would amend the Internal Revenue Code to create parity in tax treatment for scholarships and loan repayment between the NHSC and the Nurse Corps.

This legislation is endorsed by the American Nurses Association, the American Association of Colleges of Nursing, the American Association of Nurse Anesthesiology, the Association of Public Health Nurses, the Association of Rehabilitation Nurses, Friends of the National Institute of Nursing Research, and the Oncology Nursing Society.

The full text of the bill can be found here.