Explain it to Me: Higher taxes coming due to Biden loan write-off

Sep 2, 2022 | Wisconsin Voices Blog

College Graduates

IRG President CJ Szafir in the Center Square: “The roughly 70% of Wisconsinites that do not have a bachelor’s degree are already fighting inflation and now because of Biden, will have to pay other people’s student loans too.

Wisconsin is one of 13 states that will tax student loan cancelation credits

When these loans are ‘forgiven,’ the borrowers will be forced to pay hundreds of dollars in state income taxes – essentially penalizing them for the president’s reckless action. Wisconsin taxpayers deserve better from its leaders and this latest campaign gimmick is about to have real-world consequences for far too many.” Read more here.

Additional Context from IRG:

  • What happened? President Biden issued an EO forgiving $10,000 in federal student loans for borrowers who currently make less than $125,000 (for an individual) or $250,000 (for a couple). Borrowers or $20,000 if those students qualified for a Pell Grant.
  • What’s the truth? 31% of Wisconsinites have a four-year degree. They make far more money and are far less likely to be unemployed than those without one. Those without a degree have to pay their debts too while fighting inflation in family budgets. Now, they have to pay other people’s student loans too. This policy sends a horrible message that will likely make college even less affordable and will continue to erode trust in colleges and universities, as well as the federal government.

  • What should be done? Higher education should be about meeting people where they are and helping them on the path to meeting their career and life goals. We can also reduce the number of jobs that require a four-year degree. This is the fastest and easiest way to lower the cost of higher education, promote opportunity, and even help employers find and attract a more diverse workforce.