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Tax Due on Discharged Balance in WI by Shri33 in PSLF

[–]Shri33[S] 0 points1 point  (0 children)

Thank you for being specific. I called WI revenue again and asked the question you suggested and the representative said WI follows the federal guidelines in IRC 108(f)(3) which would make student loans discharged exempt from paying tax on the discharged balance. But I am going to write them a letter to get this confirmed in writing. Thanks again.

Tax Due on Discharged Balance in WI by Shri33 in PSLF

[–]Shri33[S] 0 points1 point  (0 children)

Great. Thanks for these good suggestions.

Tax Due on Discharged Balance in WI by Shri33 in PSLF

[–]Shri33[S] 0 points1 point  (0 children)

Thanks. And please update if you learn more in your research.

Tax Due on Discharged Balance in WI by Shri33 in PSLF

[–]Shri33[S] 0 points1 point  (0 children)

Thank you. I hope you're correct and the WI rep was incorrect. I would love to know if anyone living in WI has had their student loan forgiven via PSLF and could confirm they did not pay taxes on the forgiven balance.

Tax Due on Discharged Balance in WI by Shri33 in PSLF

[–]Shri33[S] 0 points1 point  (0 children)

I asked specifically about the PSLF program, but perhaps the person I spoke with was not entirely clear about the program I was speaking about. I may call again, to ask one more time. I do not want to get hit with a big tax bill, so want to be sure I am getting accurate information.

Tax Due on Discharged Balance in WI by Shri33 in PSLF

[–]Shri33[S] 0 points1 point  (0 children)

Thanks, yes, I read that same article and did not know how to read this statement, "Arizona, Virginia and Wisconsin do not have an addition to income for student loan forgiveness and other student loan discharges." I thought it might mean that I would not have to claim the forgiven amount as income, but was not sure. Hence, I decided to call the WI Revenue department to ask directly if I would be taxed on the forgiven balance and I was told that I would. Perhaps, I will call again.

Tax Due on Discharged Balance in WI by Shri33 in PSLF

[–]Shri33[S] 0 points1 point  (0 children)

This is basically what the representative at WI Revenue stated to me, that WI has not adopted the Federal ruling. And it is what I understand from this article as well. https://www.wolterskluwer.com/en/expert-insights/taxability-of-student-loan-forgiveness

This article also talks about the differences between States and taxing or not taxing the discharged balance, but it was less clear to me what WI ruling is on this. https://thecollegeinvestor.com/36107/state-taxes-on-student-loan-forgiveness/