Student loan cancellation is a hotly debated issue for Americans who took on debt to attend college. While you can get a loan forgiveness with less money to pay off later, your finances can still take a short-term blow from an unlikely source: a student loan tax bomb. This is especially the case for borrowers on income-tested repayment plans that are not part of the federal qualifying student loan exemption programs.
Can Debt Forgiveness Cause a Student Loan Tax Bomb?
