text: SECTION 1. DEDUCTION FOR STUDENT LOAN PAYMENTS BY MEDICAL PROFESSIONALS 
                PRACTICING IN RURAL AREAS.
  
      (a) Interest on Student Loans Not Treated as Personal Interest.--
  Section 163(h)(2) of the Internal Revenue Code of 1986 (defining 
  personal interest) is amended by striking ``and'' at the end of 
  subparagraph (D), by striking the period at the end of subparagraph (E) 
  and inserting ``, and'', and by adding at the end thereof the following 
  new subparagraph:
              ``(F) any qualified medical education interest (within the 
          meaning of subsection (k)).''.
      (b) Qualified Medical Education Interest Defined.--Section 163 of 
  the Internal Revenue Code of 1986 (relating to interest expenses) is 
  amended by redesignating subsection (k) as subsection (l) and by 
  inserting after subsection (j) the following new subsection:
      ``(k) Qualified Medical Education Interest of Medical Professionals 
  Practicing in Rural Areas.--
              ``(1) In general.--For purposes of subsection (h)(2)(F), 
          the term `qualified medical education interest' means an amount 
          which bears the same ratio to the interest paid on qualified 
          educational loans during the taxable year by an individual 
          performing services under a qualified rural medical practice 
          agreement as--
                      ``(A) the number of months during the taxable year 
                  during which such services were performed, bears to
                      ``(B) the number of months in the taxable year.
              ``(2) Dollar limitation.--The aggregate amount which may be 
          treated as qualified medical education interest for any taxable 
          year with respect to any individual shall not exceed $5,000.
              ``(3) Qualified rural medical practice agreement.--For 
          purposes of this subsection--
                      ``(A) In general.--The term `qualified rural 
                  medical practice agreement' means a written agreement 
                  between an individual and an applicable rural community 
                  under which the individual agrees--
                              ``(i) in the case of a medical doctor, upon 
                          completion of the individual's residency (or 
                          internship if no residency is required), or
                              ``(ii) in the case of a registered nurse, 
                          nurse practitioner, or physician's assistant, 
                          upon completion of the education to which the 
                          qualified education loan relates,
                  to perform full-time services as such a medical 
                  professional in the applicable rural community for a 
                  period of 24 consecutive months. An individual and an 
                  applicable rural community may elect to have the 
                  agreement apply for 36 consecutive months rather than 
                  24 months.
                      ``(B) Special rule for computing periods.--An 
                  individual shall be treated as meeting the 24 or 36 
                  consecutive month requirement under subparagraph (A) 
                  if, during each 12-consecutive month period within 
                  either such period, the individual performs full-time 
                  services as a medical doctor, registered nurse, nurse 
                  practitioner, or physician's assistant, whichever 
                  applies, in the applicable rural community during 9 of 
                  the months in such 12-consecutive month period. For 
                  purposes of this subsection, an individual meeting the 
                  requirements of the preceding sentence shall be treated 
                  as performing services during the entire 12-month 
                  period.
                      ``(C) Applicable rural community.--The term 
                  `applicable rural community' means--
                              ``(i) any political subdivision of a State 
                          which--
                                      ``(I) has a population of 5,000 or 
                                  less, and
                                      ``(II) has a per capita income of 
                                  $15,000 or less, or
                              ``(ii) an Indian reservation which has a 
                          per capita income of $15,000 or less.
              ``(4) Qualified educational loan.--The term `qualified 
          educational loan' means any indebtedness to pay qualified 
          tuition and related expenses (within the meaning of section 
          117(b)) and reasonable living expenses--
                      ``(A) which are paid or incurred--
                              ``(i) as a candidate for a degree as a 
                          medical doctor at an educational institution 
                          described in section 170(b)(1)(A)(ii), or
                              ``(ii) in connection with courses of 
                          instruction at such an institution necessary 
                          for certification as a registered nurse, nurse 
                          practitioner, or physician's assistant, and
                      ``(B) which are paid or incurred within a 
                  reasonable time before or after such indebtedness is 
                  incurred.
              ``(5) Recapture.--If an individual fails to carry out a 
          qualified rural medical practice agreement during any taxable 
          year, then--
                      ``(A) no deduction with respect to such agreement 
                  shall be allowable by reason of subsection (h)(2)(F) 
                  for such taxable year and any subsequent taxable year, 
                  and
                      ``(B) there shall be included in gross income for 
                  such taxable year the aggregate amount of the 
                  deductions allowable under this section (by reason of 
                  subsection (h)(2)(F)) for all preceding taxable years.
              ``(6) Definitions.--For purposes of this subsection, the 
          terms `registered nurse', `nurse practitioner', and 
          `physician's assistant' have the meaning given such terms by 
          section 1861 of the Social Security Act.''.
      (b) Deduction Allowed in Computing Adjusted Gross Income.--Section 
  62(a) of the Internal Revenue Code of 1986 is amended by inserting 
  after paragraph (14) the following new paragraph:
              ``(15) Interest on student loans of rural health 
          professionals.--The deduction allowable by reason of section 
          163(h)(2)(F) (relating to student loan payments of medical 
          professionals practicing in rural areas).''.
      (c) Effective Date.--The amendments made by this section shall 
  apply to taxable years beginning after December 31, 1992.
target: Amends the Internal Revenue Code to allow an itemized deduction for personal interest paid on an education loan by a health care professional (medical doctor, registered nurse, nurse-practitioner, or physician's assistant) performing services in a rural community or on certain Indian reservations for at least 24 consecutive months under a written agreement.  Limits such deduction to $5,000. 
  Allows the computation of such deduction in determining adjusted gross income.
feat_title: A bill to amend the Internal Revenue Code of 1986 to allow a deduction for amounts paid by a health care professional as interest on student loans if the professional agrees to practice medicine for at least 2 years in a rural community.