Teachers, social workers, nurses and other workers who fulfill essential roles in our economy have been eligible for some types of student loan forgiveness, but Pennsylvania has treated debt relief as income and l taxed accordingly.
This meant that someone whose debt had been forgiven by $50,000 would have been hit with a tax bill of $1,535 from the State Department of Revenue.
This is flat out false, and Governor Tom Wolf’s administration recently correctly announced that canceled debt would no longer be considered taxable income.
The governor explained, “These people have chosen to serve the public, and often in less remunerative fields, because they want to make a difference. They don’t have thousands of dollars lying around to pay a one-time tax bill. So it is wrong to take what should be a blessing and make it just another burden.
It’s nice to see that even a tax-and-spend liberal like Wolf has limits when it comes to seeing the government take what doesn’t belong to them.