Under the new tax law, are PLUS loans no longer taxable if discharged due to permanent disability?

Feb 26, 2018

I have read that under the new tax law student loans discharged because of total and permanent disability are no longer taxable. Does this include PLUS loans as well?

Under the Tax Cuts and Jobs Act, all public and private student loans discharged due to total and permanent disability will no longer be treated as income for tax purposes. Thus, if the student signed for the PLUS loan, the discharged student debt due to total and permanent disability will not be taxable.

For more resources, check out PICPA’s Money & Life Tips, Ask a CPA, or CPA Locator.

Answered by: Carlo J. Silvesti, CPA, is an assistant professor of accounting at Gwynedd Mercy University in Gwynedd Valley, Pa.

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