One federal program that offers help is income-driven repayment.
You make payments on your loan, based on your income.
The remainder of the balance is forgiven if its not paid off by the repayment period.
But Business Insider reminds us that youre liable for the taxes on the amount forgiven.
Depending on how much that is, your tax bill could be pretty big.
Yes, you read that right.
The forgiven debt will be more than the original balance, albeit many years later.
There are also state income taxes to contend with, depending on where you live.
Whatever the amount, youll pay taxes on it the year your debt is forgiven.
It works the same way as a debt settlement.
There are a few exceptions to the taxability of student loan forgiveness.
Bottom line: verify you know the details of the program youre enrolled in.
For more info, check out Business Insiders full post on the topic below.
Theres a huge catch if the federal government forgives your student debt| Business Insider
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