Do you have student loans? Here’s how you could benefit from the new stimulus bill

A major new coronavirus stimulus bill was passed on Wednesday.

In addition to highly anticipated $1,400 stimulus checks for many Americans, the $1.9 trillion bill includes other tax thrusts for people affected by the pandemic, including expanded tax credits over the next year for children, child care and family leave plus spending for renters, feeding programs and people's utility bills.

One of the other major provisions in the bill is a set of benefits for millions of student loan borrowers.

More stimulus bill content from RADIO.COM
—Newly passed COVID relief bill includes $1,400 stimulus checks
—Here's how the $3,000 child tax credit works
—Third stimulus check: When might you receive a $1,400 check?

President Joe Biden is expected to sign the bill into law on Thursday afternoon. Here is what you need to know about how the package affects you if you have student loans, according to Forbes.

Under the new bill, student loan borrowers will not be taxed on student loan forgiveness through January 1, 2026.

The provision applies across a broad swath of issued loans, including federal student loans from the government, federally-guaranteed FFEL-program student loans, as well as private student loans.

The exemption relieves borrowers, who have been stymied by taxes on canceled student loans before this bill.

The new package allocates $170 billion in aid to schools from kindergarten thru high school, as well as colleges and universities.

Specifically, $35 billion of this amount would go towards higher education institutions to supplement reopening costs and student aid, and could include direct monetary assistance to many struggling college students.

Many of the benefits in this bill, including stimulus checks, extended unemployment, and the child tax credit, will not be considered taxable income.

This means that if you are still paying your student loans, the aid you receive from the package should not impact you if you are paying on an income-based repayment plan.

The new bill adds $7.25 billion in additional funding for the Paycheck Protection Program designed to aid small business owners.

In the past, PPP did not include owners who had delinquent or defaulted federal student loans.

But because Biden recently opened up the eligibility for PPP to include these categories, these individuals will now be eligible for his benefit.

While the new bill does benefit student loan borrowers in a few ways, it does not include student loan forgiveness.

However, proponents of student loan reform have held that certain provisions in the package, such as temporary tax relief for student loan forgiveness, provide a strong base for future attempts to pass student loan forgiveness rules, whether through legislation or a presidential executive action.

LISTEN NOW on the RADIO.COM App
Follow RADIO.COM
Facebook | Twitter | Instagram