Bloomberg Tax
Aug. 30, 2022, 9:36 PMUpdated: Aug. 30, 2022, 10:04 PM

Mississippi, in a Departure, to Tax Forgiven Student Debt (1)

Angélica Serrano-Román
Angélica Serrano-Román

Several states are moving ahead to exempt residents from being taxed on forgiven student loan debt under President Joe Biden’s relief plan, while Mississippi has decided against the exemption.

New York, Pennsylvania, Kentucky, Virginia, Hawaii, and Idaho are the latest states to exempt their residents that qualify under Biden’s plan from state income tax. Others—Arkansas, California, Massachusetts, and South Carolina—are still reviewing whether debt forgiveness will be subject to taxation.

The canceled debt will be subject to income taxes in Mississippi, the state Department of Revenue confirmed.

As debt cancellation is generally considered income, the federal government exempted student loan ...

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