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COVID Tax Break Could Open Door To Student Loan Forgiveness

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FILE - In this Oct. 24, 2019, file photo students walks in front of Fraser Hall on the University of Kansas campus in Lawrence, Kan. Student loan forgiveness might be on the way after all, according to experts who see the tax break included in the $1.9 trillion stimulus package as a bellwether. The tax break would ensure any debt forgiven from Dec. 31, 2020, to Jan. 1, 2026, won’t be counted as income — effectively nixing the argument that cancellation would prompt a tax burden on borrowers. (AP Photo/Orlin Wagner, File)

(AP)–Student loan forgiveness might be on the way after all, according to experts who see the tax break included in the $1.9 trillion stimulus package as a bellwether.

The tax break would ensure any debt forgiven from Dec. 31, 2020, to Jan. 1, 2026, won’t be counted as income — effectively nixing the argument that cancellation would prompt a tax burden on borrowers.

Democrats in Congress, student loan debt forgiveness advocates and multiple state attorneys general have called on President Joe Biden to forgive debt through executive action. But Biden stated repeatedly while campaigning and since entering office that he supports forgiveness through congressional action.

 

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