Student loan forgiveness could become tax free permanently

The American Rescue Plan Act of 2021 made student loan forgiveness tax free at the federal level through the end of 2025.

Before that change took place during the COVID-19 pandemic, any student loan debt canceled by the government was considered taxable and levied at the borrower’s normal income tax rate.

President Joe Biden’s 2025 fiscal year budget includes a provision that would shield forgiven educational debt from federal taxes permanently.

The ADA continues to advocate for student loan debt relief, including legislation that would lower interest rates overall and pause the accrual of interest and payments on federal student loans for dental students in residency.

Read more: CNBC

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