ElLoco: Ok, I've gotta do the notsureifserious.jpg thing here...

Because I'm actually not sure.

I just got trolled, didn't I? Craaap

TiltingAtWindmills: ElLoco: Ok, I've gotta do the notsureifserious.jpg thing here...

Because I'm actually not sure.

I just got trolled, didn't I? Craaap

I honestly don't know. Ordinarily, I'd say yes... but I can just never tell anymore with some of the stuff people post. This thread is a prime example. I don't know whether to chuckle or facepalm.

I think people are forgetting that she got $91k, and even after paying the tax would still be $65k ahead of where she would be without the cancellation. She got $65k for free.

Anyone know how it works with foreclosures then? Presumably people are taxed on the difference of what is owed versus value of the house or something? // too lazy to even search the internet ...

Nabb1: MaudlinMutantMollusk: TheDumbBlonde: MaudlinMutantMollusk: TheDumbBlonde: Let me to repeat: You borrow money..you pay taxes.

So that's how mortgage deductions work?

Tax deductions have zero to due with forgiven debt. Ergo: tax due. Is life as a genius difficult?

It was an honest question. A mortgage is borrowed money, yet it's usually a deduction on your taxes. I'm neither a genius nor a tax accountant, and apparently, you aren't either

Yes, a mortgage is borrowed money, but you get a deduction on qualifies payments on mortgage interests. This, on the other hand, is extinguishment of a debt, which has always, as a general rule, been considered taxable income by the IRS. If your bank called tomorrow and told you they were canceling the last $91,000 due on your mortgage and you didn't have to pay it, you would have to claim that as income on your tax return and you would owe taxes on that $91k.

Dude, you're really missing the point. The original poster was implying that you always pay taxes when borrowing, and the response was to point out that with mortgages you sort of get some tax forgiveness.

We all get the difference, but you missed the humor and are trying to argue seriously.

jtown: WhyteRaven74: cuzsis: /

I don't understand why people think getting cancer should be like winning the lottery.

I don't understand why people think getting cancer should equal losing your home, personally. Almost happened to my dad (and teenage me, living with him) after my mom died from it. That's one of those things that ought to be debt-forgiven in my opinion. Yup, can't pay your medical bills... get out of the house, we'll take it from here. You can sleep under a bridge, right?

jabelar: I think people are forgetting that she got $91k, and even after paying the tax would still be $65k ahead of where she would be without the cancellation. She got $65k for free.

Anyone know how it works with foreclosures then? Presumably people are taxed on the difference of what is owed versus value of the house or something? // too lazy to even search the internet ...

Oh, you can't swim after losing your boat. Poor lass. Yes you may drop that 91 pound lead weight, yes here, have a 26 pound lead weight instead.

jabelar: I think people are forgetting that she got $91k, and even after paying the tax would still be $65k ahead of where she would be without the cancellation. She got $65k for free.

Anyone know how it works with foreclosures then? Presumably people are taxed on the difference of what is owed versus value of the house or something? // too lazy to even search the internet ...

So far the they are not taxing on the difference. They should and they were going to but I don't know what happened and I also am to lazy to search the interweb

To those who insist that she "got something" out of it and now owes: By the logic of capitalism (which is the opposite of logic), the only purpose of getting an education to get a better job and earn more money. Therefore, since she cannot get a job because of her disability, she cannot earn the money, so she has not benefited from her education at all, therefore she still received nothing. Capitalists don't consider learning for the sake of learning to be important, so by that logic, she got nothing and should owe nothing, right?

(Only half joking.... I really don't understand capitalist thought processes)

Got a problem with the tax on debt cancellation? Then don't accept the cancellation, and instead pay back the debt.

Problem solved.

wow sometimes Fark is smarter than the average person... but then you get a thread like this where half the people don't understand that forgiven debt = income, and therefore should be taxed?

In this case, if the taxed individual can't pay the taxes for some reason, the IRS has ways to deal with that situation, but the default starting position should be that she should be taxed. Otherwise you could start a company, give your employees a 100k 'loan', they go out and buy a car or a house or whatever, and then the company says, 'oh, your 100k debt is forgiven!' - the employee still has car/house/whatever, and no one ever has to pay income tax. The lady got money, used it to get education, and then she doesn't have to pay the money back? The lenders paid her income, and she got something of value out of it, she owes tax. Simple.

SphericalTime: SphericalTime: That's . . . Odd. I'm sure there are people trying to abuse the system that might be manipulating debt cancellation, but it seems fairly obvious that someone with a clear permanent disability isn't going to be getting rich on student debt cancellation.

I hope the IRS figures this out in a farming hurry.

Farking hurry, rather. Damned autocorrect.

You sounded ghey the first time. Are you from the department of reduncany department?

SphericalTime: That's . . . Odd. I'm sure there are people trying to abuse the system that might be manipulating debt cancellation, but it seems fairly obvious that someone with a clear permanent disability isn't going to be getting rich on student debt cancellation.

I hope the IRS figures this out in a farming hurry.

There's nothing for the IRS to figure out. Congress needs to figure this out!

WhyteRaven74: Except it makes no logical income. A canceled debt simply zeros out a balance sheet, it doesn't reverse things.

Under normal conditions it does make sense. It's not the canceled debt per se that's the income, but rather the money you borrowed and now no longer have to repay. *THAT* *IS* income. It should be considered income in normal circumstances.

It doesn't make sense in a situation like this. It doesn't apply in foreclosures although actually in some cases it should--the guys who do a strategic default should get hit with the tax.

jabelar: I think people are forgetting that she got $91k, and even after paying the tax would still be $65k ahead of where she would be without the cancellation. She got $65k for free.

Anyone know how it works with foreclosures then? Presumably people are taxed on the difference of what is owed versus value of the house or something? // too lazy to even search the internet ...

Taxes aren't typically paid on the difference when dealing with asset forfeiture. In other word's, if someone repo's your house that you owe 100k on and it sells for 50k, the lender is just out 50k unless you pay it back as long as they wish to maintain collections against you, but since you still owe it, it cannot be considered income at this point. If the lender, for some reason, decides to absolve you of the debt and end any and all collections, you can be liable for the income taxes on the 50k. Note that no money has pass directly your way at any time for you to have this as income.

Basically, if anyone claims that you owe the money, it is non-taxable. If they release you from all obligations to repay a loan and you are free and clear, you can now be 1099'd for the unpaid debt as the forgiven debt will not and cannot be collected. The unpaid debt was a capital gain in your favor.

aybara: Only in America can not seeing any actual income be taxed for income.

...but it *is* income.

If I give you a check for $91,000 and then say "nah, you don't need to pay it back", then you made $91,000 that you didn't have before. It's definitely income -- no reason it shouldn't be taxed.

Loren: SphericalTime: That's . . . Odd. I'm sure there are people trying to abuse the system that might be manipulating debt cancellation, but it seems fairly obvious that someone with a clear permanent disability isn't going to be getting rich on student debt cancellation.

I hope the IRS figures this out in a farming hurry.

There's nothing for the IRS to figure out. Congress needs to figure this out!

WhyteRaven74: Except it makes no logical income. A canceled debt simply zeros out a balance sheet, it doesn't reverse things.

Under normal conditions it does make sense. It's not the canceled debt per se that's the income, but rather the money you borrowed and now no longer have to repay. *THAT* *IS* income. It should be considered income in normal circumstances.

It doesn't make sense in a situation like this. It doesn't apply in foreclosures although actually in some cases it should--the guys who do a strategic default should get hit with the tax.

It should apply in all cases. If you borrow $400k to buy a house and walk away because it is only worth $300k. you should get a 1099 for $100k..or at least have to pay a LT cap gain rate of 15%...you should not be able to walk away without any penalty for making a bad decision. You will see how many ppl start making their payments. FLA is a hotbed for collecting rent on a house in foreclosure and not making a mortgage payment for years because the process is so slow.

EvilHomer: If you borrow $400k to buy a house and walk away because it is only worth $300k. you should get a 1099 for $100k

Except that $100k is never realized. The bank doesn't get it when they take back the house. You don't get it when you move in to the house. There is no $100 of income to be taxed.

You don't pay income taxes on that $100k for the same reason you don't pay taxes when your stock goes up -- until you actually sell that stock (or the house) and convert it to cash you haven't realized any income.

Quartlow: WhyteRaven74: It's a very odd definition of income to say that discharged debt, after all the money has been spent, all of a sudden counts as income.

It isn't rocket science. If it hadn't been discharged it would have been repaid eventually. Provided under normal circumstances she was able to repay it. In this case she was loaned the money, spent it on school (her choice by the way) At the point they canceled her debt it became income. In other words money she received to spend on school by her choice. Doesn't matter whether or not it is spent or not.

By your theory, if I spend it its not income? In that case I have it made, I spend everything

My God, it's like... somebody took the time to think about things.

So, if I were to get my loans discharged off of an original principal of 40k would they come after me for the taxes on the current balance due of over 100k? It seems unfair too, that they would count the entire income in the year the loan was forgiven rather than spread out over the years the loans were taken out. Spread out over the years my income for most of those years would be in a much lower bracket.

What is really frustrating is I applied for aid because of a disability and the paperwork was so screwed up it never came through, so I took out loans. Towards the end of my college I applied for disability. I didn't have a lawyer and I got turned down. At that point I wasn't able to support myself, so I took out more loans to stay in college even although I was beginning to have serious doubts about whether I was going to be able to make it in the working world. I couldn't.

Eh, what am I worried about. I've been fighting with them to discharge my loans for 10 years while on disability. What are the odds they will finally discharge them.

(Another pet peeve of mine was that State and Federal awards were awarded for a set number of years, not a set amount. I got $75 one year because I was still living at home. Later, because I'd used up that year's coverage I didn't have enough semesters of coverage left. At that point, based on my own income, I would have been eligible for thousands of dollars.)

A credit card company just threatened to do this too. They seem to be claiming penalties and interest long after the credit card was cancelled, trying to claim a balance more than twice what was owed to report for tax purposes. That card was maxed out paying for medication.

Did I mention part of my disability includes panic attacks brought on by stress like money problems. FML.

As someone going through this, I've got to say if she didn't qualify for the insolvency exemption, there is something fishy going on, and it's not just a house. I suspect there is taxable income she's getting, that the "retiring with disability pension" in the article is not the same as just social security, for example. If she's got enough assets to not qualify for the insolvency exemption (especially the way they use medical bills in it) I'm not sure she should have taken the optional (not automatic) step of asking for a full discharge of student loans, which is its own process, and can be denied even if you're found disabled by the federal government for other purposes.

/Just too much missing in the article to not be really fishy.

Thompson's accountant

She just had close to 100k of debt wiped out and she has an accountant.

If she can afford one of those...

profplump: EvilHomer: If you borrow $400k to buy a house and walk away because it is only worth $300k. you should get a 1099 for $100k

Except that $100k is never realized. The bank doesn't get it when they take back the house. You don't get it when you move in to the house. There is no $100 of income to be taxed.

You don't pay income taxes on that $100k for the same reason you don't pay taxes when your stock goes up -- until you actually sell that stock (or the house) and convert it to cash you haven't realized any income.

Wrong, selling a stock at a gain that you paid for and walking away from a mortgage debt are two different things. There is no cap gain on the house because it lost value. so your comparison doesn't make sense. Now if you borrowed money, Ie Margin, to buy the stock and the stock went down. You would still owe the margin debt. If you did not pay that debt you would be sued and hypothetically if it was forgiven you would be issued a 1099.

"white people leave a will, black people leave a bill"

It's ok, I'm a black comedian who came back to life as a white guy.

I can solve this problem in 2 words:

FLAT TAX!

/it really is that simple

jtown: I don't understand why people think getting cancer should be like winning the lottery.

It's not that she got cancer, it's that she's now disabled.

So, here's a question..

How much of that 91k was accrued interest? All these companies that handle student loans (Fannie Mae, AES.. etc) RAPE RAPE RAPE people with interest, late charges, and other random assorted fees that they tack onto the original loan.
In a helluva a lot of cases... the MAJORITY of the monies owed on a student loan are actually shiate the lender has added to the original principal.
It's a farking racket.

So, how the flying fark does accrued interest...etc... count as income?

EvilHomer: Wrong, selling a stock at a gain that you paid for and walking away from a mortgage debt are two different things. There is no cap gain on the house because it lost value. so your comparison doesn't make sense. Now if you borrowed money, Ie Margin, to buy the stock and the stock went down. You would still owe the margin debt. If you did not pay that debt you would be sued and hypothetically if it was forgiven you would be issued a 1099.

I agree with your general analysis of loan forgiveness. And I'm aware that the home in the original example lost value (which only makes the original poster's point more confusing). But your example doesn't apply to home loans secured with mortgages, because there's no realized income, which was my entire point.

If the homeowner is in a jurisdiction where a delinquency balance can be collected, the amount of loan forgiveness is exactly equal to the sale price of the reposed home, and the remaining loan balance is not forgiven. In other jurisdictions the bank has stipulated that the value of the home is at least equal to the value of the loan, and therefore the exchange of the home for loan forgiveness is an equal-value trade. So in both cases there is no income or loss realized by the homeowner, and therefore no tax to be collected.

ZydrateZombie: So, here's a question..

How much of that 91k was accrued interest? All these companies that handle student loans (Fannie Mae, AES.. etc) RAPE RAPE RAPE people with interest, late charges, and other random assorted fees that they tack onto the original loan.
In a helluva a lot of cases... the MAJORITY of the monies owed on a student loan are actually shiate the lender has added to the original principal.
It's a farking racket.

So, how the flying fark does accrued interest...etc... count as income?

You are trying to apply logic to a law that was stupid to begin with...

Tax liability on forgiven debt is utter bullshiat. It doesn't matter if it forgiven student loans or property mortgages.

Dinjiin: Tax liability on forgiven debt is utter bullshiat. It doesn't matter if it forgiven student loans or property mortgages.

How you figure? Borrow = Pay if not, you received money for doing nothing. If you work and get paid ,which I am assuming you do not, you pay income tax. Explain why you should not be taxed on money you collect and do not pay back?

profplump: EvilHomer: Wrong, selling a stock at a gain that you paid for and walking away from a mortgage debt are two different things. There is no cap gain on the house because it lost value. so your comparison doesn't make sense. Now if you borrowed money, Ie Margin, to buy the stock and the stock went down. You would still owe the margin debt. If you did not pay that debt you would be sued and hypothetically if it was forgiven you would be issued a 1099.

I agree with your general analysis of loan forgiveness. And I'm aware that the home in the original example lost value (which only makes the original poster's point more confusing). But your example doesn't apply to home loans secured with mortgages, because there's no realized income, which was my entire point.

If the homeowner is in a jurisdiction where a delinquency balance can be collected, the amount of loan forgiveness is exactly equal to the sale price of the reposed home, and the remaining loan balance is not forgiven. In other jurisdictions the bank has stipulated that the value of the home is at least equal to the value of the loan, and therefore the exchange of the home for loan forgiveness is an equal-value trade. So in both cases there is no income or loss realized by the homeowner, and therefore no tax to be collected.

you are correct. right now it is jurisdictional. there was legislation to make it standard..not sure what happened. My point was what I stated ....Any loan is perceived income and should be taxed accordingly. the income was the money you received to purchased the home, car, tv or whatever. If the issuer of the loan is willing to assume the risk of the default due to none payment and not issue a 1099...thats on them.... if you have a car repossessed and they sell the car at a lessor value or default on a CC you are usually issued a 1099 nowadays

Being disabled sucks. Being disabled and in debt sucks even more. But being disabled, having your debt forgiven, and owning a house? Lucky you. Sell your house, pay your taxes, and count your blessings.

That gives me an idea on how to royally fark people up. Send them an invoice for some service you didn't provide (but they can't prove you didn't provide) for a large amount of money. Hassle them about it for a while and when they threaten to sue, just offer to write it off. Get them to sign a form saying it's written off and they owe nothing. Then send them a 1099 and watch the IRS go after them if they don't pay up. I'd say 99% of people out there have no immediate idea that you have to pay taxes on this kind of thing.

SphericalTime: That's . . . Odd. I'm sure there are people trying to abuse the system that might be manipulating debt cancellation, but it seems fairly obvious that someone with a clear permanent disability isn't going to be getting rich on student debt cancellation.

I hope the IRS figures this out in a farming hurry.

They already did. Read the part where it's not taxable if she meets the insolvency criteria. And here lawyers claim about how confusing the forms are. Bottom line is that if you can't pay the taxes, it's forgiven. If you have the means to pay the taxes, then you do it. Notice how the amount of taxes exceeds the bracket the lump sum would put her in?

She may also be able to treat the loan as income in the years she received it, instead of a lump sum.

I'm sorry she has a tumor but why does she get to have her student loan forgiven? Does that mean she gets a free car too? What about students that got tumors but paid off their loans or didn't get loans in the first place - do they get to apply for this lotto windfall? Somehow I don't think they give the money back if you get sick after you pay it off.

Sorry but debt and tax forgiveness belongs in bankruptcy court, not feel good statutes that give loophole windfalls to certain special interests.

She has to pay the debt of public employees. They get forgiveness without CODI because public servants are "underpaid". Underpaid. Some are. Teachers need assistance. DMV employees do pretty well, but still should qualify, in some cases. But they give it to cops! The average income for cop here in Oakland (new window) was $119, 337, in 2010; in Berkeley (new window), it was $120,138. This in addition to the 20 yr public safety retirement at 90% rate, the best health care plans around, and significant other perks. They underpaid? Meanwhile the State Parks can't afford to stay open. I know where our tax dollars are going.

krackpipe: She has to pay the debt of public employees. They get forgiveness without CODI because public servants are "underpaid". Underpaid. Some are. Teachers need assistance. DMV employees do pretty well, but still should qualify, in some cases. But they give it to cops! The average income for cop here in Oakland (new window) was $119, 337, in 2010; in Berkeley (new window), it was $120,138. This in addition to the 20 yr public safety retirement at 90% rate, the best health care plans around, and significant other perks. They underpaid? Meanwhile the State Parks can't afford to stay open. I know where our tax dollars are going.

Debt has nothing to do with pay. They shouldn't forgive debt of teachers or cops or public employees or private employees. What if the student decides to take a vow of poverty and joins the clergy? Should they also get debt forgiveness because they choose a field that does some public good but pays crappy?

If you get a loan, pay it back. If you can't, file for bankruptcy. This woman obviously has the means to pay or her tax bracket wouldn't be that high or she would have qualified for the tax forgiveness or she would have filed for bankruptcy and had the debt discharged instead of forgiven.

Gyrfalcon: Fooky_Monster: So what about scholarships and VA benefits...is that taxable income?

You're kidding, right?

Scholarships are only usable for the purpose for which they are applied--that is a "scholarship" to UCLA is merely free admittance to UCLA. It has no intrinsic cash value, and the recipient can't get $10,000 cash instead of the scholarship.

VA benefits were already paid for by the servicemember's prior service to his or her country, and I won't listen to your lame arguments to the contrary.

See this is exactly why I rarely post on this site. I ask a simple question...because I really don't know the answer and I get Mr. tiny genitals showing off his arrogance. Hope you enjoy being such a kind hearted person.

Animatronik: Animatronik: It's basically a hoop you jump through, don't get ripped off by the self-important professorial establishment that is making 5-figure bacon at teh expense of middle class families.

Oops. meant 6-figure bacon.

What school did you go to where the professors are making 6 figures? I know my alma mater doesn't pay that kind of money to professors. The engineer associate professors start at about $50k, and full professors top out at $95k, and engineering, as opposed to liberal arts, is a rather lucrative field for academics since industry pulls up the prices. (The university library has a printout of the salary of every employee.)

Chimperror2: Debt has nothing to do with pay.

Maybe you're just trolling, but I disagree that pay has nothing to do with debt. The two are related. However, I agree with your idea of no debt forgiveness programs -- pay it back or apply for bankruptcy. But the problem with your post is that bankruptcy does not apply to student loans. So for argument's sake, let's look at these forgiveness programs the way they were designed: to help low-income public positions if the public employee is willing to work where they otherwise wouldn't work. Eg, teachers have to work inner city for 5 years straight to get a portion forgiven. OK. Not perfect, but you can see the logic. But then cop unions heard about it and got their boys in. Not only do cops make 2-3 times what others entitled to this program make, forgiveness applies to cops living anywhere in the US, not just undesirable places. Now the entire forgiveness program is insanely expensive for reasons that have nothing to do with the few it was supposed to support. And who pays? Your last point about priests is a problem because public money can't go to support religious programs in the US.

krackpipe: Chimperror2: Debt has nothing to do with pay.

Maybe you're just trolling, but I disagree that pay has nothing to do with debt. The two are related. However, I agree with your idea of no debt forgiveness programs -- pay it back or apply for bankruptcy. But the problem with your post is that bankruptcy does not apply to student loans. So for argument's sake, let's look at these forgiveness programs the way they were designed: to help low-income public positions if the public employee is willing to work where they otherwise wouldn't work. Eg, teachers have to work inner city for 5 years straight to get a portion forgiven. OK. Not perfect, but you can see the logic. But then cop unions heard about it and got their boys in. Not only do cops make 2-3 times what others entitled to this program make, forgiveness applies to cops living anywhere in the US, not just undesirable places. Now the entire forgiveness program is insanely expensive for reasons that have nothing to do with the few it was supposed to support. And who pays? Your last point about priests is a problem because public money can't go to support religious programs in the US.

I specifically brought up clergy to show how special interests make debt forgiveness stupid as they tailor the value to support special interests (and yes, public money can support religious programs as there are many students at Georgetown and Notre Dame with student loans that paid tuition. Last time I checked Notre Dame was still playing University of Michigan in football under a contract between the state of michigan and a catholic university and medicare pays Catholic Healthcare West when a patient gets admitted to their hospitals). If you want teachers to work in the inner city, pay them more. In fact pay them what they would forgive in debt and they will stay longer and get a broader spectrum of teachers (those with and without loans). Teachers in debt can use that money to pay off the loans. The kid that worked his way through college without debt should get the same benefit as Ms. $96,000 did. Are we really rewarding the people that wracked up debt more than those that didn't? It seems that becomes a form of indentured labor. There shouldn't be any "forgiveness" programs.

And pay has nothing to do with debt. If you borrow $20 from your college friend and $20 from the single mom that makes more than your college friend, do you really care what they make before you pay them back? If you loan your car to your college friend and they decide to keep it because they are in college, do you really think it's okay because they don't make any money so asking them to return your car is unreasonable? If they were injured and then retired but still had enough in retirement to afford their own car, are they still entitled to keep yours? That's a forgiveness program on a micro-scale and it should be obvious that it doesn't work..

Individuals should make decisions ABOUT their debt based on their income but their obligation to repay it is completely separate.

krackpipe: Chimperror2: Debt has nothing to do with pay.

Maybe you're just trolling, but I disagree that pay has nothing to do with debt. The two are related. However, I agree with your idea of no debt forgiveness programs -- pay it back or apply for bankruptcy. But the problem with your post is that bankruptcy does not apply to student loans. So for argument's sake, let's look at these forgiveness programs the way they were designed: to help low-income public positions if the public employee is willing to work where they otherwise wouldn't work. Eg, teachers have to work inner city for 5 years straight to get a portion forgiven. OK. Not perfect, but you can see the logic. But then cop unions heard about it and got their boys in. Not only do cops make 2-3 times what others entitled to this program make, forgiveness applies to cops living anywhere in the US, not just undesirable places. Now the entire forgiveness program is insanely expensive for reasons that have nothing to do with the few it was supposed to support. And who pays? Your last point about priests is a problem because public money can't go to support religious programs in the US.

And yes you can discharge student loans in bankruptcy if you show that you cannot maintain a "minimal" standard of living for youself if forced to repay the student loans and additional circumstances exist indicating that this state of affairs is likely to persist for a significant portion of the repayment period of the student loans and you have made good faith efforts to repay the loans. Meet those three requirements (which seems like a reasonable requirement for all debts) and the debt will be discharged and it is not income. The lady in this bews article does not meet these requirements but she wants to be treated as if she did.

gameshowhost: ect to the same. What's that? It'll never happen? Great: Make this never happen again either.

.
.
It is. Been that way for several decades.

Hrist: That gives me an idea on how to royally fark people up. Send them an invoice for some service you didn't provide (but they can't prove you didn't provide) for a large amount of money. Hassle them about it for a while and when they threaten to sue, just offer to write it off. Get them to sign a form saying it's written off and they owe nothing. Then send them a 1099 and watch the IRS go after them if they don't pay up. I'd say 99% of people out there have no immediate idea that you have to pay taxes on this kind of thing.

That's the problem with our tax system - 99% of people out there have no idea what they need to pay.

Chimperror2: krackpipe: Chimperror2: Debt has nothing to do with pay.

Maybe you're just trolling, but I disagree that pay has nothing to do with debt.

Individuals should make decisions ABOUT their debt based on their income but their obligation to repay it is completely separate.

An obligation to pay has nothing to do with income, but rather with a decision to take on a debt. We can agree on this point, now that you've changed it to separate obligation from decision. No reasonable person believes that pay has nothing to do with debt.

Accordingly, back to real programs which do exist. The real programs of forgiveness were designed as enticements to lower income public service positions, such as teachers and other lesser-paid civil servants. They were approved to apply to a handful of underserved (due to undesireability, eg inner city, or inaccessibly rural) areas in the US. They were implemented for 5 year commitments. Five years of undesirable work in these areas in trade for forgiveness of a portion of a student loan, I believe maxed at $20,000[citation needed]. Subsequently, in real life, police unions caught wind of it and managed to have forgiveness provided to all police officers without respect to where they serve. This has made the program billions of dollars more expensive to the taxpayer with no benefit to the taxpayer, do you see this? Meanwhile officers make 2-3 times as much pay as the other civil servants and, by your argument, could simply pay out of their higher pay rate. Boondoggling is one example of why the IRS is seeking so hard to be a cost-recovery agency and hammering her with the CODI bill.

chimperror2 said "Meet those three requirements (which seems like a reasonable requirement for all debts) and the debt will be discharged and it is not income. The lady in this bews article does not meet these requirements but she wants to be treated as if she did."

that pretty much sums it up.



She was given 90k, didn't pay it back. It's income. Pay your taxes on it

Boo farking hoo. Paying $30K much better than $91K, We should all be so lucky.
Suck it!

netcentric: chimperror2 said "Meet those three requirements (which seems like a reasonable requirement for all debts) and the debt will be discharged and it is not income. The lady in this bews article does not meet these requirements but she wants to be treated as if she did."

that pretty much sums it up.

She was given 90k, didn't pay it back. It's income. Pay your taxes on it

Correct. At least with my points, that's not even at issue since she doesn't qualify for loan forgiveness via any program. That said, the forgiveness programs have (arguably) been faultily implemented.

Pick: Boo farking hoo. Paying $30K much better than $91K, We should all be so lucky.
Suck it!
I think she should pay, but I'm not hating on her -- others are getting forgiveness that don't need it whereas she have to pay. For example, cops around here. They have loan forgiveness, at our taxpayer expense, but most could probably pay. Oakland cops (new window) averaged $119,337 per year in 2010, why we paying off their loans?

Begoggle: ByOwlLight: lazyguineapig33: whoa whoa whoa. 91,000 titty farking dollars for your student loans? my god. wtf did she buy???!!!!!!

lol. I have friends who have student loan debt up to $250,000. $91,000 isn't insane at all.

It is pretty insane.
$250,000 is even more insane.
How many years would it take to pay that off? Why even go to college??
I have no debt, I never had any loans for schooling, and even if I did, 6 years of schooling wouldn't have cost $91,000 unless I got an incredibly high rate on the loan.


People are stupid and nuts. Borrow $91,000 for an education that results in a social work job? Last time I checked those jobs pay about $30K tops.

I'd like to hear the "whole" story. She probably borrowed money for things completely unrelated to actual school costs.