November 20, 2025

'Tax bomb' worth over $10,000 could hit some student loan borrowers in 2026, senators and advocates warn

IntelME Verdict

Tax Law Change

TL;DR

Starting in 2026, student loan borrowers under income-driven repayment plans may face tax bills over $10,000 due to expiring exemptions, prompting Senate Democrats' concerns.

Analysis

The potential tax bills exceeding $10,000 for student loan borrowers under income-driven repayment plans in 2026, due to expiring exemptions, highlight a significant tax law change. Tax professionals need to prepare clients for these unexpected tax liabilities and explore mitigation strategies to minimize the financial impact on affected individuals.

Source

CNBC
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