Tax Consequences of Loan Discharges for Borrowers in Income-Driven Repayment Plans
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| Title: | Tax Consequences of Loan Discharges for Borrowers in Income-Driven Repayment Plans |
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| Language: | English |
| Authors: | Institute for College Access & Success |
| Source: | Institute for College Access & Success. 2020. |
| Availability: | Institute for College Access & Success. 405 14th Street 11th Floor, Oakland, CA 94612. Tel: 5110-559-9509; Fax: 510-845-4112; e-mail: admin@ticas.org; Web site: http://www.ticas.org |
| Peer Reviewed: | N |
| Page Count: | 11 |
| Publication Date: | 2020 |
| Document Type: | Reports - Descriptive |
| Education Level: | Higher Education Postsecondary Education |
| Descriptors: | Taxes, Income Contingent Loans, Loan Repayment, Student Loan Programs, Loan Default, Income, Debt (Financial), College Graduates |
| Abstract: | This brief illustrates that while many borrowers in IDR [income-driven repayment] will repay their loans in full, those who do receive a discharge of remaining debt after 20 or 25 years of responsible payments may face an unaffordable tax liability because these discharged amounts are treated as taxable income under current law. |
| Abstractor: | As Provided |
| Entry Date: | 2020 |
| Accession Number: | ED607697 |
| Database: | ERIC |
| Abstract: | This brief illustrates that while many borrowers in IDR [income-driven repayment] will repay their loans in full, those who do receive a discharge of remaining debt after 20 or 25 years of responsible payments may face an unaffordable tax liability because these discharged amounts are treated as taxable income under current law. |
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