DAVIS INTRODUCES LEGISLATION TO PROTECT STUDENT LOAN BORROWERS
March 9, 2021
WASHINGTON, DC - Today Congressman Danny K. Davis (IL-07) introduced the Stop Taxing Student Loan Relief Act which offers tax protection for student loan borrowers. Cancellation of student loan debt is likely taxable for the borrower. Without a forgiveness mechanism, borrowers whose loans are discharged can be met with hefty tax bills. "Student loan borrowers are often struggling to make ends meet and should not be penalized for qualifying for loan relief." Davis stated. "This bill exempts student loan forgiveness from taxation through 2026".
Current law is very uneven and loans forgiven under the Public Service Loan Forgiveness Program or discharged due to Total and Permanent Disability are non-taxable. However, loans forgiven under the income-driven repayment system are taxed.
Congressman Danny K. Davis is the Chairman of the Family & Worker Subcommittee on the House Ways and Means Commitee