There is a catch to Biden’s student loan scam and the Democrats would like you to pretend it doesn’t exist.
“The Department of Education will provide up to $20,000 in debt cancellation to Pell Grant recipients with loans held by the Department of Education and up to $10,000 in debt cancellation to non-Pell Grant recipients. Borrowers are eligible for this relief if their individual income is less than $125,000 ($250,000 for married couples),” the White House said in a press release.
Guess what everybody loan forgiveness is taxable income and eventually, Americans are going to have to pay up. It’s not like those IRS agents the Biden administration is getting ready to sic on America are going to have any compassion. As Rep. Tom Massie noted, the IRS ramped-up enforcement division is not training to take down billionaire tax evaders they are coming for the middle class.
Notice the scenario in this IRS recruiting program is “taking down a landscape business owner who failed to properly report how he paid for his vehicles,” not “taking down a billionaire who uses the corporate jet for private trips.”pic.twitter.com/QXlHmDCoWb
Usually, no matter your income level, the IRS treats canceled debt as taxable income. The American Rescue Plan Act, enacted during the pandemic, paused any taxes on student loan forgiveness from 2021 through 2025 but only for those whose student loans are classified under the Income-Driven Repayment program. In other words, everybody getting their loan forgiven will have to pay up come 2025.
More catches are coming too.
The Department of Education is set to provide more information about the debt cancellation in the next few weeks. Right now, the DOE website doesn’t even mention that those whose loans will be forgiven will have to pay taxes.
Now, if you read media reports on the program, they don’t bring this up (as of the writing of this post). Biden is clearly buying votes (and shoring up his base) for the midterms, and his goal will be accomplished before the liberal drones find out they have to pay income tax on Biden’s little scam. Also, note that borrowers won’t have to pay taxes on the forgiveness until 2025, which means it will be the next president’s problem.
What Biden is doing is Washington politics at its worst.