Here's a fucked up thing I learned the other day:
If you are a US person with federal student loans, you may be eligible for an income-based repayment plan!
If you make your payments in full and on time for 20-30 years (depending on specifics of loans & plans) the remaining balance is forgiven!
You pay INCOME TAXES on whatever amount is forgiven!!!!
Yes that's right, INCOME TAX
And that counts interest accrued as well!
And depending on how poor you are, your income-based payment plan may have been small enough the loan was still growing in those years!!!
So you could make payments for 20 years
Owe more than you originally borrowed
Have that amount forgiven
And the government calls that amount INCOME and CHARGES YOU TAXES ON IT
I MUST STRESS THAT YOU ARE NOT RECEIVING ANY MONEY IN THIS SCENARIO
and YET you pay INCOME TAXES on it
On the money you do not have, which you never will have, which the government has said they aren't going to ask for any more because you've dutifully made your payments on time
Please consider the ramifications. Of being someone who makes little enough that you were on a low payment income based plan for 20 years. It is not a difficult position to be in. Say you make $30k annually.
And when your loans are forgiven, you still owed $130k.
You will now be taxed as if your income that year were $160k.
There are so many bigger problems right now, but this stupid bit of petty cruelty is pissing me off.
