Teachers union sues to shield forgiven student loan borrowers from tax hit

Straight Arrow News

The American Rescue Plan Act of 2021 shielded all student loan forgiveness from taxation at the federal level. That law expires on December 31, 2025, and was not extended by the Trump administration.

“I was very disappointed, but not necessarily surprised, that this Congress didn’t extend the tax moratorium,” Betsy Mayotte, President of the Institute of Student Loan Advisors, told Straight Arrow News. I do hope that a future Congress realizes the impact of taxing this liability and changes their mind in the future, but there’s no guarantee that they’re going to.”