Some States Could Tax Student Loan Forgiveness

You probably won’t pay federal income taxes on forgiven student loan debt, but there are some states that will or could tax your student loan forgiveness.

Outline of the United States
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President Biden’s student loan debt forgiveness plan is on hold due to legal challenges. The U.S. Supreme Court will hear the case in February and a ruling isn't expected until June, when student loan payments are expected to resume.. But there's always another important tax question out there involving student loans: will you have to pay state taxes on your forgiven student loan debt?

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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.