I cannot imagine what it must be like to be in debt with student loans in these chaotic political times. In just the past few years: Biden announced relief that was later overturned by the courts, then announced very promising income-based repayment plans. Trump then cancelled most of those new repayment plans that had made debt (and interest) much more manageable, and imposed more restrictions on the forms of Public Service that would "count" as work that qualified for eventual loan cancellation for people working in lower-wage public sector jobs.
Those who did get debt relief in 2025 were shielded from being taxed on the amount cancelled, because the American Rescue Plan Act clarified that student loan debt relief was not income.
But. Those protections expired in December, and now those who did get at least some of their loans cancelled may be facing unexpected five-figure tax bills.
Many students who aspire to college come from families who cannot possibly pay the costs. It is egregious to subject these people to this much financial chaos when loans were the only option available to them. Those who did get relief under income-based repayment plans are among the lowest earning college graduates.
Some forms of loan cancellation will be taxed while others will be exempt, but it is all a tremendous mess that punishes so many people for the sin of being born to low-income parents.
Meanwhile, Amazon's tax bill has plummeted this year as profits soar, thanks to new tax regulations passed by the GOP in 2025.
