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Message
re: Student Loan Repayment Options Explained
Posted on 4/15/15 at 11:19 am to anc
Posted on 4/15/15 at 11:19 am to anc
quote:
Public Service Forgiveness Act. Make any eligible payments (Standard, Graduated, IBR, PAYE) made for 10 years while employed by such agency, and the loan balance is forgiven - without being taxable
Currently doing this, and I printed out the IRS publication that mentions it being tax free. I'm almost 95% sure that when it comes time to write it off someone will drop the ball and issue me a 1099. At which point I will take the position it is not taxable and attach a copy of my IRS publication.
3
Posted on 4/15/15 at 11:24 am to GreenTrout
quote:
Currently doing this, and I printed out the IRS publication that mentions it being tax free. I'm almost 95% sure that when it comes time to write it off someone will drop the ball and issue me a 1099. At which point I will take the position it is not taxable and attach a copy of my IRS publication.
Thats a great idea. Besides being 10 years less, the biggest difference in the normal forgiveness and the Public Service forgiveness is the tax liability.
Posted on 4/15/15 at 1:46 pm to GreenTrout
quote:
Currently doing this, and I printed out the IRS publication that mentions it being tax free. I'm almost 95% sure that when it comes time to write it off someone will drop the ball and issue me a 1099.
Just remember that the govt forgiveness plan only applies to public NOT Private Loans. Most of my wife's grad school loans are private- and in excess of 100k.
This post was edited on 4/15/15 at 1:48 pm
Posted on 4/15/15 at 2:19 pm to GreenTrout
quote:
Currently doing this, and I printed out the IRS publication that mentions it being tax free. I'm almost 95% sure that when it comes time to write it off someone will drop the ball and issue me a 1099. At which point I will take the position it is not taxable and attach a copy of my IRS publication.
I've had a bit of trouble locating specific language, aside from this, which I found to be vague with regard to nailing down the point that amounts forgiven under PSLF are not taxable
Can you provide the IRS language in question, or were you looking at Pub. 970 as well? TIA
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