Income-Dependent Education Assistance Act of 1991

Income-Dependent Education Assistance Act of 1991 - Establishes the income-dependent education assistance (IDEA) program of supplemental direct higher education student loans in which a borrower's annual repayment obligation is dependent upon both postschool income level and borrowing history.

Title I: System for Making Income-Dependent Education Assistance Loans - Directs the Secretary of the Treasury to: (1) make IDEA loans to eligible students in accordance with this title; and (2) establish an account for each IDEA loan borrower and collect repayments on such loans using the income tax collection system under specified Internal Revenue Code provisions added by title II of this Act.

Sets forth provisions for the terms and enforcement of IDEA program agreements between the Secretary of Education and eligible institutions.

Sets forth provisions for the amounts and terms of IDEA loans. Sets annual limits on the amounts of such loans to various categories of students. Sets a limitation on individual borrowing capacity, with adjustments for inflation and with consideration of any outstanding student loan obligations. Limits the duration of individual eligibility for such loans.

Sets forth requirements for: (1) agreements to the terms of such loans; and (2) disbursement of the proceeds of such loans.

Sets forth the responsibilities of eligible institutions and of the Secretary of the Treasury for certain information requirements relating to the IDEA loan program.

Sets forth provisions for interest charges on such loans. Requires such charges to be added to the recipient's obligation account at the end of each calendar year. Bases such charges on an interest rate equal to the lesser of: (1) ten percent; or (2) the sum of the average bond equivalent rates of 91-day Treasury bills auctioned for the previous year, plus two percentage points, rounded to the next higher one-eighth of one percent.

Provides for conversion and consolidation of certain other types of student loans as IDEA loans. Authorizes the Secretary of the Treasury, upon request of borrowers who have received federally insured or guaranteed loans under specified provisions of the Higher Education Act of 1965 (HEA) (Stafford loans) or of the Public Health Service Act (PHSA) (HEAL loans), to make new IDEA loans to such borrowers which are equal to the sum of the unpaid principal of those other loans and which discharge the liability on those other loans.

Provides for mandatory conversion of certain defaulted student loans to IDEA loans. Requires IDEA collection treatment of any loan made, insured, or guaranteed under specified provisions of HEA or PHSA after enactment of this Act which is assigned after default for collection by the Secretary of Education or the Secretary of Health and Human Services. Directs such Secretaries to notify: (1) the Secretary of the Treasury of the need to establish or adjust an IDEA account for such loan's borrower; and (2) the borrower of the conversion of the defaulted loan to an IDEA loan and the procedures for collection under the income tax system.

Terminates the authority to make additional loans under the HEA programs of supplemental loans for students (SLS) and direct loans to students in institutions of higher education, for any academic year beginning after the date regulations are prescribed by the Secretaries of Education and the Treasury to carry out this title.

Directs the Secretary of Education to study and report to the Congress on the effects of the IDEA program on participating institutions' tuition rates and accrediting and licensure standards.

Authorizes appropriations to: (1) make distributions of IDEA loan funds to eligible institutions; and (2) administer and carry out this title.

Bases student eligibility for IDEA loans on their eligibility for student assistance under specified HEA provisions and their carrying at least one-half the normal full-time academic workload.

Title II: Collection of Income-Dependent Education Assistance Loans - Amends the Internal Code to add provisions for the collection of IDEA loans.

Directs the Secretary of the Treasury to notify each IDEA loan borrower of their yearly repayment obligation.

Sets forth formulas for computation of the annual IDEA loan repayment amount. Makes such amount equal to the lesser of: (1) 20 percent of the excess of the modified adjusted income of the taxpayer for such taxable year over the standard deduction and exemption (twice for joint returns); or (2) the product of a base amortization amount and a progressivity factor based on the taxpayer's modified adjusted gross income.

Defines "base amortization amount" as the amount which, if paid at the close of each year for 12 consecutive years, would fully repay (with an eight-percent annual interest rate) the maximum account balance of the borrower. Sets forth progressivity factor tables for various types of taxpayers.

Provides that, in general, the repayment obligation of an IDEA loan borrower shall terminate only if there is repaid: (1) in the case of any repayment during the first 12 years for which the borrower is in repayment status, the principal plus interest at an annual rate equal to the otherwise applicable rate plus two and one-half percent; and (2) in the case of any repayment during any subsequent year (or in the case of loans under $3,000 repaid during the first 12 years), the principal plus interest at applicable rates. Requires no repayment after 25 years in repayment status.

Sets forth provisions for the determination of years in repayment status.

Sets forth the requirements for payment of the amount owing. Directs the Secretary of the Treasury to assess and collect any unpaid amount in the same manner as for any delay in the payment of income tax.

Provides for discharge, by the Secretary of Education, of the IDEA loan liability of any borrower who dies or becomes permanently and totally disabled.

Provides for crediting of amounts paid on a joint return.

Sets forth formulas for computation of an alternative annual payment for individuals who have attained age 55.

Provides for inflation adjustment in the computation of the progressivity factor.

Provides that, in general, an IDEA loan shall not be dischargeable in a case of bankruptcy, but authorizes the Secretary of the Treasury to postpone certain portions of the loan liability in such cases.

Makes specified provisions relating to finality of assessment and collection applicable to such loans.

Includes the amount required to be repaid for IDEA loan under amounts listed under requirements relating to failure by an individual to pay estimated income tax.

Requires individuals who are obligated to make IDEA loan repayments to file income tax returns for the applicable years.