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Monday Nov 13, 2017

Tell Congress Not to Compound Student, Resident Debt Burden

By now you may already be tired of hearing about congressional efforts to overhaul the tax code. But unless you actually read all 429 pages of the House bill, you might not know everything you need to know.

The media has offered exhaustive coverage of tax-reform efforts in recent weeks. Numerous outlets have offered their lists of "winners and losers" who would be affected by the bill, but two important groups have been overlooked in this avalanche of analysis: medical students and residents.

[Red stamp that reads Tax Deductible]

Section 1204 of H.R. 1, the Tax Cuts and Jobs Act(www.congress.gov), would repeal Section 221 of the Internal Revenue Code(www.gpo.gov), which provides a deduction of up to $2,500 for interest paid on student loans each year. That means family medicine residents would lose $7,500 in deductions during their three-year training programs.

The deduction applies to filers with gross incomes less than $80,000 (or $160,000 for joint filers). According to a Medscape survey of residents(www.medscape.com), the average U.S. medical resident makes $57,200 a year.

I was the first person in my family to go to medical school, and I didn't take the decision lightly. My family wasn't rich, or even middle class. Thanks to scholarships, I completed my undergraduate degree debt-free. But by the time I finished my M.P.H. and M.D., I faced a six-figure debt -- just like most of my peers.

According to the Association of American Medical Colleges, more than three-fourths of physicians leave medical school with student debt, and the average owed is nearly $200,000(members.aamc.org).  Stripping away more than $7,000 in tax relief will make it even harder for residents and new physicians to repay their debts. And that added financial burden won't help draw students to primary care rather than to higher-paying subspecialties.

Debt and financial concerns are among the causes of physician burnout(jamanetwork.com). By eliminating the deduction for interest on education loans, the House is simply piling on.

It's worth noting that the Senate retains the deduction for student loan interest in its version of the tax bill. The House needs to do the same. The AAFP has written a letter to House leaders(1 page PDF), urging them to eliminate Section 1204 of the bill before putting it to a vote as early as this week.

You can help, too, by using the Academy's Speak Out tool to tell your representatives to retain the deduction for interest on student loans. Becoming a physician -- and paying for that training -- is daunting enough. Tell your representatives not to make it even harder.

Alexa Mieses, M.D., M.P.H., is the resident member of the AAFP Board of Directors.

Posted at 01:30PM Nov 13, 2017 by Alexa Mieses, M.D., M.P.H.

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