Skip to comments.Editorial: Passage of tax bill would be a small token of thanks for sacrifice
Posted on 05/04/2012 9:46:22 AM PDT by SmithL
In February 2011, Marine Lance Cpl. Andrew Carpenter was shot and killed while on patrol in Afghanistan.
A lending company subsequently forgave his student loan, but now his parents are on the hook for a $28,000 tax bill as a result.
U.S. Rep. Scott DesJarlais, R-Tenn., is outraged. And he's sponsoring a bill that would prevent the Internal Revenue Service from taxing loans to fallen service members that have been forgiven.
The Andrew P. Carpenter Tax Act is one bill that all members of both parties can and should support.
"It is a fitting way to fix a glaring problem in our tax code, while paying tribute to the memory of Lance Cpl. Carpenter," DesJarlais said. "His family has experienced the pain of losing their son, husband and father. Hopefully, if passed, this measure will in some way ease this burden."
Three years prior to his death, Carpenter, a Columbia, Tenn., native, had taken out a $20,000 student loan to help pay for his college education. His parents co-signed for him.
Carpenter attended Middle Tennessee State University and Columbia State Community College before enlisting in the Marines. A member of the 26th Marine Expeditionary Unit, the 27-year-old was on patrol in southern Afghanistan when he was shot by a sniper. He died of his wounds in Germany on Feb. 19, 2011.
The lending company forgave the student loan after being notified of Carpenter's death.
The IRS, however, treated the forgiven loan as it always does as income. It hit the Carpenter family with a tax bill on the amount $28,000, including interest.
(Excerpt) Read more at knoxnews.com ...
Wow, a forgiveness of a $20,000 four year old loan generates a $28,000 tax bill including interest? Can this be right?
Russian immigrant to me....”IRS vorse than KGB”
I smell Obama here..
No. More likely $2800.
More liberal bad math.
How does this tax fall on the family rather than the estate?