Student borrowers in shock over 'zero balance' as federal program fulfills elusive promise

[Demovictory9]

https://www.msn.com/en-us/news/us/student-borrowers-in-shock-over-zero-balance-as-federal-program-fulfills-elusive-promise/ar-AATdcEl

The notice from the federal government took Lee Dossett, a doctor in Lexington, Kentucky, by surprise. "Congratulations!" it began.

After a couple of years of denials for a student loan forgiveness program designed for public servants, Dossett, who has worked in the nonprofit sector for 10 years, was told last week that not only was his application re-evaluated, but that the Department of Education had determined he should have his outstanding medical school loans erased altogether — about $75,000 worth.

"I was completely shocked because I had honestly given up on getting it," Dossett said.

But a record number of student borrowers are reaping the same benefit after the Biden administration in October began relaxing stringent rules around Public Service Loan Forgiveness, which launched in 2007 to help teachers, health care workers, military members and other public servants earn debt relief on their federal loans. As of last week, more than 70,000 borrowers qualified for debt forgiveness, amounting to about $5 billion in relief, the Department of Education said.

Before the overhaul, just 16,000 borrowers of about 1.3 million enrolled applicants had their loans' remaining balances expunged through the program, according to federal data.

[babylonsister]

1. There are 70K+ people dancing in the streets-great job! nt

[Hortensis]

18. :) Yes!! The other half million borrowers are going to be extremely jazzed also

at finding all their loan payments to date are now counted as they should always have been.

WE did this.

[Klaralven]

2. Is Student Loan Forgiveness Taxable? It Depends.

https://www.forbes.com/sites/adamminsky/2020/01/27/is-student-loan-forgiveness-taxable-it-depends/

[Celerity]

6. Is All Federal Student Loan Forgiveness Currently Tax-Free? Yes, the Biden Administration's

American Rescue Plan, which passed in March 2021, included an income tax exclusion for all federal student loan discharges through December 31, 2025.

This new exclusion makes IDR forgiveness tax-free as well as any other type of student debt cancellation that a borrower may receive from the federal government. Note that the Tax Cuts and Jobs Act (which went into effect January 1, 2018) had already made death and disability discharges tax-exempt through 2025.

It's important to understand that the new laws passed by Congress only directly influence the federal taxability of student loan forgiveness. Depending on where you live, you may still owe state income taxes on the cancelled debt.

While many states that charge state income tax do conform with the federal government's definition of adjusted gross income (AGI), some don't. Check with your state's Department of Revenue or consult with a tax professional to learn more about how student loan forgiveness could impact your state tax bill.

https://www.prnewswire.com/news-releases/is-student-loan-forgiveness-tax-free-301402468.html

[Ohio Joe]

3. Thank you President Biden

[OhioTim]

22. Was Biden's Name On The Letter?

Republicans would have Trump's name everywhere.

[Alexander Of Assyria]

4. More achievement of Biden, never mind little response from mass media, the People will

wake up to the achievements, big time….bridge by bridge, road by road, airports and ports…fatter bank accounts of the People, not the fat hidden stashes of the corporations.

[greenjar_01]

5. This happened to three people I know based on PSLF - all with multiple 10s of thousands

still outstanding.

Zero balance, done.

Pretty nice!

[CanonRay]

7. So freaking vote Democratic

The Rethugs would never let this happen.

[Alien Life Form]

8. How long before..

the GOP claims credit for this?

[WhiskeyGrinder]

9. Now do all federal loans!

[Farmer-Rick]

23. Yeah, now do all 42 million people.

He helped about 0.6 million.....do all 42 million.

[karin_sj]

10. This is great news!

[GB_RN]

11. We Are The Only Major Country In The World...

That makes an advanced education unaffordable and basically for-profit, even at public institutions. Nowhere else in the world is a college education, for those qualified to attend, a debt burden. It's insane.

[MineralMan]

12. Want More of This? GOTV!

[AllyCat]

20. Just one more great thing to add to the list of what Biden is doing for Americans!

I'm checking with my lender to see if I qualify. Have been paying on student loans all my life. Had enough and would love some relief, even if I don't have much left.

So many owe WAY more than me and they need a break!

[forgotmylogin]

13. I'm glad something is happening on this...

Every single time the Biden Admin or Kamala Harris tweets something innocuous like "Happy Valentines Day" there are 300,000 replies that are just "YOU SAID YOU WOULD CANCEL STUDENT LOAN DEBT!!11" over and over.

[Moebym]

25. Schumer has taken to tweeting this at least once a day.

[BeckyDem]

14. K&R

[gratuitous]

15. Uh oh, how will President Biden deal with this latest catastrophic setback?

Student borrowers are in shock, and I don't think that's covered under Obamacare. That is good news for John McCain (naturally), and could prove to be an insuperable obstacle to President Biden as he continues to struggle with dropping poll numbers that are still 10-20 points better than the former guy.

This has been your New York Times Pitchbot post for the day . . .

[Demovictory9]

17. "senile" Biden and "cackling" Harris?

[whathehell]

16. Thanks President Biden!

[SleeplessinSoCal]

19. Is the White House hiding its light under a bushel?

Please speak up! Spread the word....

https://www.forbes.com/sites/zackfriedman/2022/01/26/biden-has-cancelled-15-billion-of-student-loans/

[amaico]

21. Student borrowers, or "Some student borrowers"?

Misleading title.

[Farmer-Rick]

24. Yup

There are about 42 million more who desperately need help.

Compounded interest makes getting a student loan equal to getting a mortgage for a middle class house only with a much bigger interest rate.

[demtenjeep]

26. how can I get involved with this

shit I've been paying for 25 years

[amaico]

27. It's only for public sector workers

Only.

[demtenjeep]

28. teachers are not public sectors?

Okay

[Demovictory9]

30. its definitely for educators

[ChoppinBroccoli]

29. My Wife Tried To Apply For Student Loan Forgiveness As A Public Employee

She's worked for the Attorney General's Office for well over the required amount of years (I think it's 10 years, but whatever it is, she's way over that). She got all her paperwork together, submitted her application, and got denied. Her student loan carrier basically told her, "Sorry, but you don't have the right KIND of student loan to qualify." In other words, they made up a bullshit reason and denied her. Yet another reason why I hate student loan carriers with the white-hot burning passion of a thousand suns.