Bloomberg Tax
Free Newsletter Sign Up
Login
BROWSE
Bloomberg Tax
Welcome
Login
Advanced Search Go
Free Newsletter Sign Up

Discharged Student Debts Won’t be Reported to IRS, States

Sept. 9, 2022, 9:28 PM

Taxpayers participating in the Biden administration’s student loan debt forgiveness program won’t have to account for the benefit on their federal tax returns, but they could face problems when filing state returns because lenders likely won’t issue cancellation of debt forms.

Last year the IRS issued guidance, Notice 2022-1, under the American Rescue Plan Act. The agency directed lenders and student loan servicing agencies to stop issuing Form 1099-C, cancellation of debt, for the forgiveness of student loan debt between 2021 and 2025. The form, required for discharges of debt greater than $600, is generally sent to ...