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Student loan forgiveness programs no longer subject to Pa. state income tax

This decision will save people eligible for those programs potentially thousands of dollars in state tax.

PENNSYLVANIA, USA — Editor's note: The above video is from Dec. 15. 

Governor Tom Wolf announced today that Pennsylvanians will not have to pay state income tax on the student loan debt relief they get from the federal Public Service Loan Forgiveness (PSLF) Program and the Pennsylvania Student Loan Relief for Nurses (SLRN) Program, according to a press release.

This decision will save people eligible for those programs potentially thousands of dollars in state tax.

Gov Wolf said in a statement: 

“The point of student loan forgiveness programs for public servants is that these are people who have chosen jobs, often in lower paying fields, because they want to make a difference. It’s wrong to take what should be a blessing and turn it into just another burden. As a Commonwealth and as a nation, we can’t afford for astronomical student loan debt to keep talented people from choosing to serve as teachers, firefighters, or nurses. We need to make sure that financial burdens don’t keep our best and brightest from taking on some of our most important jobs." 

Student loan forgiveness is not considered taxable income on the federal level, and with this decision today, Pennsylvania joins the majority of other states.

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