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Taxes Student Loan Forgiveness and Company Student Loan Assistance Benefit
IRS Program #: X9QQU-T-01035-23-O
CTEC #: 6257-CE-0204
CE: 1 IRS & 1 CTEC credit
Speaker: Fred Amrein
Due to COVID and the National Forbearance, new legislation was added to help borrowers better manage their student loans. From a tax preparer's standpoint, these changes were not a priority since payments were optional. Tax preparers must increase their knowledge of repayment and forgiveness as we approach the repayment restart and the IRS data integration.
These changes affect both the individual and the business sector. At a time when student loan servicers should be increasing their service hours, borrowers will see a reduction in service hours. The current student loan service level is built to handle approximately 325K monthly calls. Starting October 1, 2023, over 25 million borrowers will begin making payments again. This event is another reason; tax preparers and financial advisors have a great opportunityin the coming months.
New laws include tax-free reimbursement for student loan payments, payment credit months toward loan forgiveness, tax exposure for loan forgiveness, and employment verification for Public Service Loan Forgiveness (PSLF). This program will cover these topics so you are knowledgeable for individuals and company customers.
- Explanation of the various student loan forgiveness programs and tax exposure
- Overview of business rules for tax-free student loan reimbursement under Section 127
- Implementation decisions companies need to consider before implementing a student loan assistance benefit.
- Secure Act impact on proper college funding decisions