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North Carolina says Biden's student loan forgiveness will be taxed, and 3 more states are likely to follow suit
The Biden administration's student loan forgiveness plan is exempt from federal tax
businessinsider.com
North Carolina says it will tax Biden's student loan forgiveness, and 3 more states are likely to...
Student loan forgiveness is considered taxable income in North Carolina, the state's Department of Revenue said on Wednesday.
6:16 AM · Sep 2, 2022
https://www.businessinsider.com/north-carolina-student-loan-debt-forgiveness-taxed-2022-9
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https://archive.ph/GzmXk
Student-loan forgiveness will be considered taxable income in North Carolina, the state's Department of Revenue said on Wednesday.
Although the Biden administration's student-loan-forgiveness plan is exempt from federal tax, the debt relief is triggering some individual state taxes.
In North Carolina, student-loan relief is taxable because the state has not fully adopted a specific section of the Internal Revenue Code. Congress used the provision Section 108(f)(5) to exempt forgiven student loans from between 2015 and 2021 from federal taxes as part of the American Rescue Plan Act.
The department said in the press release: "The North Carolina General Assembly did not adopt Section 108(f)(5) of the IRC for purposes of the state income tax. Therefore, student loan forgiveness excluded pursuant to IRC 108(f)(5) is currently considered taxable income in North Carolina."
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durablend
(7,416 posts)Can't have those uppity people getting free stuff.
Bettie
(15,997 posts)apparently, of their entire existence.
Geechie
(857 posts)Gonna have to rethink that no state income tax thing
Gidney N Cloyd
(19,781 posts)What's next, understanding? Common decency?
Atticus
(15,124 posts)transparently spiteful and hateful, not to mention childish.
It should be dubbed the "Neener-Neener Biden Is A Poopy-Head!" Act.
Emile
(21,891 posts)neverforget
(9,433 posts)ProfessorGAC
(64,413 posts)Sure, it's a silly, hard-hearted & low value move.
But, if someone gets out from under $400 per year of interest & several hundred in principle payments, they're still better off than the were, despite this pettiness.
Those Rs in those states won't have the negative impact they'd like to see.
underpants
(182,271 posts)Virginia tax is 2.5% over a certain amount. Off the top of my head. Thats $250. Yeah Id pay one more loan payment amount and not have interest accruing on money Im nowhere near paying off
ProfessorGAC
(64,413 posts)...where the state income tax is nearly 5%, it's still a huge benefit. So, this petty nonsense by these governors is not really accomplishing much.
tavernier
(12,322 posts)who can help out their kids and contribute to their state income at the same time.
alwaysinasnit
(5,037 posts)carrying student loans for having been cut a little slack.