EXCLUSION FOR PAYMENTS TO INDIVIDUALS UNDER NATIONAL HEALTH SERVICE CORPS LOAN REPAYMENT PROGRAM AND CERTAIN STATE LOAN REPAYMENT PROGRAMS.

SEC. 320. EXCLUSION FOR PAYMENTS TO INDIVIDUALS UNDER NATIONAL HEALTH SERVICE CORPS LOAN REPAYMENT PROGRAM AND CERTAIN STATE LOAN REPAYMENT PROGRAMS.(a) In General.—Section 108(f) (relating to student loans) is amended by adding at the end the following new paragraph:“(4) Payments under national health service corps loan repayment program and certain state loan repayment programs.—In the case of an individual, gross income shall not include any amount received under section 338B(g) of the Public Health Service Act or under a State program described in section 338I of such Act.”.(b) Treatment for Purposes of Employment Taxes.—Each of the following provisions is amended by inserting “108(f)(4),” after “74(c),”:(1) Section 3121(a)(20).(2) Section 3231(e)(5).(3) Section 3306(b)(16).(4) Section 3401(a)(19).(5) Section 209(a)(17) of the Social Security Act.(c) Effective Date.—The amendments made by this section shall apply to amounts received by an individual in taxable years beginning after December 31, 2003.