Up to $20,000 in Student Loan Cancellation is Here: But Will it Hurt Your Taxes?

President Biden extended the student loan payment pause and announced up to $20,000 in student loan debt cancellation for some borrowers—plus there’s some good tax news.

Words student loan relief on chalkboard
(Image credit: Getty Images)

President Biden made a long-awaited announcement extending the more than two-year-old pause on student loan payments through the end of this year. The Federal government will also provide student loan debt cancellation of up to $10,000 per borrower, within specific income limits, and up to $20,000 for Pell Grant recipients. To be eligible for forgiveness, student loans must be held by the Department of Education.

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Kelley R. Taylor
Senior Tax Editor, Kiplinger.com

As the senior tax editor at Kiplinger.com, Kelley R. Taylor simplifies federal and state tax information, news, and developments to help empower readers. Kelley has over two decades of experience advising on and covering education, law, finance, and tax as a corporate attorney and business journalist.