No, the new stimulus bill does not include student loan forgiveness.
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Despite the ongoing pandemic, the United States government has taken measures to stimulate the economy. A new stimulus bill was recently passed, but unfortunately for many student loan borrowers, it did not include student loan forgiveness. This means that the bill did not cancel or forgive any student loan debt.
As reported by CNBC, “Democrats had hoped the stimulus bill would include $10,000 of student loan forgiveness,” but it was not included due to lack of support from the Republican party.
It’s important to note that some measures were included in the bill that may still benefit student loan borrowers. For example, the bill extends the automatic suspension of payments and interest on federally held student loans until September 30, 2021. Additionally, any debt forgiven through income-driven repayment plans or Public Service Loan Forgiveness programs will not be counted as taxable income through 2025.
There is still some discussion around the possibility of student loan forgiveness in the future, but for now it remains uncertain. As author David Heinemeier Hansson once said, “Student loan forgiveness is just a tiny, band-aid-sized solution to a massive, hemorrhaging wound in our education system. Affordable and accessible education is the only real answer to that problem.”
Table: Comparison of Student Loan Forgiveness Proposals
| Proposal | Type of Forgiveness | Amount of Forgiveness | Who is Eligible |
|---|---|---|---|
| President Biden’s Campaign Plan | Federal student loans | $10,000 | All borrowers |
| HEROES Act | Federal and private student loans | $10,000 for economically distressed borrowers | Borrowers earning up to $125,000 per year |
| CARES Act | Federal student loans | Automatic suspension of payments and interest during pandemic | All borrowers |
| Warren/Schumer Proposal | Federal student loans | $50,000 | Borrowers earning up to $100,000 per year |
| Sanders Proposal | Federal and private student loans | Complete cancellation | All borrowers |
Video related “Does the new stimulus bill include student loan forgiveness?”
In this video, the speaker discusses the U.S. economy’s current state, with a high unemployment rate and the need for financial aid. The Heroes Act is proposed to provide $3 trillion in relief, which includes new stimulus checks, a trillion-dollar bailout for state and local governments, support for small businesses, and more healthcare coverage. The speaker remains impartial on the issue, recognizing that both parties have their opinions and will wait to see how negotiations play out. Despite the bill’s good and bad aspects, strategic spending may be necessary to bridge the gap until the economy can safely reopen and recover. Overall, the speaker hopes that everyone stays safe and well during the ongoing health and financial crisis.
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The latest stimulus package makes student loan forgiveness tax-free for borrowers who receive forgiveness from Jan. 1, 2021, through Dec. 31, 2025.
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Although it’s highly unlikely that private student loans will be included in any government forgiveness plan, there are still some options you can explore to pay off your loans faster or make your monthly bill more manageable.