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What, if any, are the tax consequences of defaulting ona student…

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What, if any, are the...
What, if any, are the tax consequences of defaulting ona student loan due to disability?
Submitted: 2 years ago.Category: Tax
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6/16/2015
Tax Professional: Barbara, Enrolled Agent replied 2 years ago
Barbara
Barbara, Enrolled Agent
Category: Tax
Satisfied Customers: 5,988
Experience: 20+ years of experience in tax preparation; 30+ years of experience as a real estate/corporate paralegal.
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Welcome to Just Answer. My name is ***** ***** it will be my pleasure to assist you with your tax question today.
The consequences of defaulting on a student loan (whether or not due to disability) are quite severe. The following link contains excellent information you may find helpful:
http://bankruptcy.findlaw.com/debt-relief/consequences-of-a-student-loan-default.html
While student loans may be forgiven due to permanent and total disability, that process takes time, and please know that if and when the loan is discharged, you will receive a 1099-C (cancellation of debt) which means you will report the forgiven loan amount as income.
The following are additional links which contain information that you may find helpful as well:
http://www.disabled-world.com/disability/finance/student-loan-claims.php
http://www.ohmyachesandpains.info/2013/02/the-bad-news-about-student-loan.html
Please let me know if you require further information or clarification.
Thank you and best regards,
Barb
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Tax Professional: Barbara, Enrolled Agent replied 2 years ago
Just following up with you to see if you have any other questions or concerns. If so, please come back to me here at your convenience, and I will be happy to assist you. If not, please take a moment to rate my answer since that is the only way I receive credit for answering you and alerts Just Answer to compensate me.
Best regards,
Barb
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Barbara
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