Treasury Should Exclude Income from Discharge of Student Loans

8 Pages Posted: 22 Sep 2016

See all articles by John R. Brooks

John R. Brooks

Georgetown University Law Center

Date Written: August 1, 2016


There are several ways that a student loan borrower can have a federal student loan discharged. In some cases, that cancellation of student debt creates taxable income, but in others it does not. This Article argues that taxing cancellation of student debt undermines the purposes of loan discharge and income-driven repayment programs like IBR and PAYE. This Article further argues that, if Congress does not act to provide a clear exclusion, Treasury has sufficient statutory and common law authority to exclude that income, and that it should do so.

JEL Classification: K34

Suggested Citation

Brooks, John R., Treasury Should Exclude Income from Discharge of Student Loans (August 1, 2016). Tax Notes, Vol. 152, No. 5, 2016, Available at SSRN:

John R. Brooks (Contact Author)

Georgetown University Law Center ( email )

600 New Jersey Avenue, NW
Washington, DC 20001
United States

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