Get your taxes done using TurboTax

gordonowski · ‎June 29, 2020

@Opus 17 wrote:
Only you can decide if it works for you. You're going to owe about $35,000 in state and federal income tax when that $100K balance is forgiven, through. Better start saving.

FYI - for others that might find this thread later, while this is true for certain loan forgiveness programs, this doesn't appear to be the case for PSLF: (source: https://studentaid.gov/manage-loans/forgiveness-cancellation/public-service/questions)

Are loan amounts forgiven under PSLF considered taxable by the IRS?

No. According to the Internal Revenue Service (IRS), student loan amounts forgiven under PSLF aren’t considered income for tax purposes.

@Opus 17 wrote:
I can definitely tell you that half your income is your spouse's and half your spouse's income is yours

I realize that from a legal ownership standpoint, my wife is entitled to half of my income. I'm still unclear as to whether this requires her to claim 50% of my income on her tax return (outside of the 8958 form) if we live in a community property state?

It sounds like in non-community property states, what we're trying to accomplish is fairly straightforward (https://www.studentloanplanner.com/married-filing-separate-paye-and-ibr/). I'm not quite sure how the screens I'm referencing in my original post get pulled through to the actual tax forms, which could help me as I look into this.