🧐 Help! I Can't Pay My Student Loans!!
(media.greatawakening.win)
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So the government is going to pay off these government secured loans. When this happens, the IRS steps in and says "Oh, you just had a lump sum increase in earnings. So now rather than paying off your loan over time, you are going to get hit with a lump sum balloon payment that is due NOW! Say $25,000 loan paid off and at 25% income tax bracket, that means somewhere near $6,250 hit. Good luck with that!!!!!l OH, and the money doesn't go to the banks, it goes to the Govt. So, they get 25 to 30% return on the payout.
The government forgiving loans is not taxable income
You may be right, It appears that the Fed may exclude taxes, but I haven't seen it in writing. There are approximately 13 states that have indicated that they will tax it as income: most notable is Hawaii at 10%. Notes I have seen say that in general, the IRS does tax this sort of measure unless specifically told not to. We will see. https://www.forbes.com/sites/adamminsky/2022/08/29/bidens-student-loan-forgiveness-could-be-taxable-in-some-states/?sh=41acb53b67fb
Didn’t know that about the states deciding that as taxable income, great point