Posted on Oct 21, 2017
Student debt forgiven, but wounded vet gets $62K tax bill
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Why is this such a big surprise?
This happens for bankruptcy also and other debt forgiveness type of situations.
https://www.nytimes.com/2014/03/28/your-money/disabled-borrowers-trade-loan-debt-for-a-tax-bill-from-the-irs.html?_r=2
This happens for bankruptcy also and other debt forgiveness type of situations.
https://www.nytimes.com/2014/03/28/your-money/disabled-borrowers-trade-loan-debt-for-a-tax-bill-from-the-irs.html?_r=2
Student debt forgiven, but wounded vet gets $62K tax bill
Posted from usatoday.com
Loans
Taxes
Disability
Posted 7 y ago
Responses: 2
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That is the elephant in the room. Debt forgiveness is still costly. The government passed law stating that if that money is "forgiven" it will be considered income and you will be taxed for it. It's the one thing they really don't tell you with regard to forgiveness.
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I'm going through something like that myself. I owed roughly 14K in student debt and per agreement in 5 years I will be taxed for that as income
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