White House agrees to student debt forgiveness for millions of borrowers
The administration explained that the agreement ensures borrowers eligible for student loan forgiveness this year will not owe federal taxes on the relief.
White House
The White House has reached an agreement on student debt forgiveness for millions of borrowers. In coordination with the American Federation of Teachers, the administration will resume the student loan forgiveness process for those who qualify under two income-based repayment plans: the Income-Contingent Repayment Plan and the Income-Driven Repayment Plan, which will remain in effect until their expiration.
The administration told The New York Post that the agreement ensures borrowers eligible for student loan forgiveness this year will not owe federal taxes on the relief.
"This is a tremendous win for borrowers. With today’s filing, borrowers can rest a little easier," said Winston Berkman-Breen, legal director of Protect Borrowers, which acted as legal counsel for the teachers union.
Meanwhile, President Trump’s One Big Beautiful Bill plans to phase out these two programs by July 1, 2028. According to estimates from the New York Post, the programs have more than 2.5 million enrollees in total.
A shift in government policy
“Trump’s Education Department—led by Linda McMahon—argued it could block these programs due to a court order pausing the Biden-era Saving on a Valuable Education (SAVE) plan, another income-driven repayment program,” explained the New York Post.
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