The new incentive account indicates the cancellation of this student loan.

Here is what you need to know.

Student loans

The new stimulus bill, the U.S. Life Saving Plan, includes that section Student loan waiver exempts tax. There will be no income tax on student loans because this will have significant financial benefits for student loan borrowers until December 31, 2025. Although the new stimulus bill does not include any student loan cancellation, it does indicate what the stimulus bill may be. Come up with an extensive student loan apology. In particular, there are three implications of canceling student loans:

1. Cancellation of a student loan may not be immediate

The stimulus account provides for five years (January 1, 2021 to December 31, 2025), specifically for tax-exempt student loans. If Congress plans to repeal student loans at the same time, it is puzzling why there will be a five-year waiver of tax-exempt student loans. There are several ways to interpret this provision. First, Congress now wants to include not only a large-scale student loan cancellation, but also an oversupply of student loans through income-based payment plans. In the long run, this may encourage many financially struggling borrowers to enroll in federal student loan loans. Alternatively, Congress may not immediately repeal student loans, and may need more time to finalize the law. Therefore, if Congress delays student loans, Congress may need longer to ensure that student loans are safe. The third option is that Congress not only plans a one-time student loan cancellation but also a five-year student loan cancellation plan.