topic Refund in Get your taxes done using TurboTax

Refund

Sissysbus — Thu, 27 Feb 2025 00:15:59 GMT

Back in November I was refunded just about all of the money I paid on my student loans over the last several years due in part to my loan being forgiven soon because the school I attended was found to have conducted fraudulent practices. My question is do I have to claim that refund on my 2024 income tax? Because of today I have not received any kind of 1099 or any other form.
Thank you for your help

Re: Refund

SabrinaD2 — Thu, 27 Feb 2025 00:30:34 GMT

Refunds from student loans due to fraudulent practices or loan forgiveness are generally not considered taxable income at the federal level.

Key Points:

You do not generally need to report the refund as taxable income on your federal tax return.
State Tax: Some states may have different rules, so check your state's tax laws. ( If you need help, reach back out and let us know your state)

For more details, you can refer to:

TurboTax on student loan refunds - scroll down to - Your loan gets discharged on account of fraud or school closure during enrollment.
IRS guidelines on student loan refunds

Re: Refund

Sissysbus — Thu, 27 Feb 2025 02:22:34 GMT

Thank you so much!

Also, I will read the article you suggested ..

And I live in Pennsylvania ..

Again thank you for your help

Re: Refund

MindyB — Thu, 27 Feb 2025 03:19:39 GMT

Pennsylvania is generally not one of the states that tax student loan forgiveness, so you won't have a state tax liability either. There are only certain circumstances Pennsylvania taxes student loan forgiveness, that do not apply to you, such as performing services in exchange for the cancellation (PERSONAL INCOME TAX BULLETIN 2009-02).

Re: Refund

Sissysbus — Thu, 27 Feb 2025 14:21:43 GMT

Thank you so much for your help!
Have a wonderful day.

Re: Refund

Opus 17 — Thu, 27 Feb 2025 14:27:14 GMT

While student loan forgiveness is generally not taxable if there is fraud involved, what about your education credits? If you got a tuition refund from the school, so that you (in effect) never paid tuition, then you may need to repay any education credits you claimed from that tuition. However, this does not affect you if the school kept the money and the government later canceled the loans.

Re: Refund

Sissysbus — Thu, 27 Feb 2025 16:31:34 GMT

Opus 17,

Yes, the school kept the money.

Thank you so much for answering my question.