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Level 2
posted Feb 5, 2025 11:50:40 PM

My state refund was $508. After inputting my $50,000 student loan forgiven under the PSLF program, my state refund jumped to $3,700. Is this right?

Turbo tax has the 'Student Loans Discharged or Forgiven under any Federally Authorized Program' section. I input the amount of loan forgiven under PSLF for NYS. Why am I getting such a huge state refund?

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1 Best answer
Expert Alumni
Feb 6, 2025 5:29:19 AM

You only need to include an amount in this screen if the loan forgiveness is taxable on your federal return and not taxable on your state return. The refund changed because TurboTax subtracted the $50,000 loan forgiveness from your state income based on the entry on this screen.

 

Because loans forgiven under the PSLF are not taxable at either the federal level or the state level, you should leave this field blank.

 

1 Replies
Expert Alumni
Feb 6, 2025 5:29:19 AM

You only need to include an amount in this screen if the loan forgiveness is taxable on your federal return and not taxable on your state return. The refund changed because TurboTax subtracted the $50,000 loan forgiveness from your state income based on the entry on this screen.

 

Because loans forgiven under the PSLF are not taxable at either the federal level or the state level, you should leave this field blank.