Taxability of Public Service Loan Forgiveness

Did you know that if you have student loans forgiven under the Public Service Loan Forgiveness the forgiven loan balance is tax free. However, if your student loans are forgiven under other types of income based repayment plans the forgiven balance is considered taxable income and you have to pay taxes on that balance in the tax year of forgiveness. If you are in one of these repayment plans you may want to start setting aside money now to cover the tax bill you will be faced with.