The IRS has issued guidance for some taxpayers who took out federal or private student loans to attend a nonprofit or for-profit school. The guidance offers relief to taxpayers whose student loans were discharged by the Department of Education and who meet certain criteria.
Typically, a discharge of indebtedness is a taxable event. Under the new IRS guidance, affected students will not recognize income as a result of the discharge. Taxpayers should not report the amount of their discharged loans on their federal income tax returns.
Find out which students meet the criteria for this tax relief here.