How Biden’s new major tax plans could hit every taxpayer
Macro Trends Advisors founding partner Mitch Roschelle discusses the impact of President Biden’s tax hike proposal.
The Biden administration on Tuesday announced that it's suspending the collection of more than 1 million federally guaranteed student loans, expanding a key coronavirus relief program to a group of Americans who were previously excluded from the government's loan freeze.
The new policy will halt the collection of loans for about 1.14 million borrowers who are in default on federal loans held by private companies. These individuals received their loans through the Federal Family Education Loan Program, which offered loans backed by private companies.
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“Our goal is to enable these borrowers who are struggling in default to get the same protections previously made available to tens of millions of other borrowers to help weather the uncertainty of the pandemic,” Education Secretary Miguel Cardona said in a statement.
The relief will apply retroactively to March 13, 2020, when former President Donald Trump first declared a national emergency, meaning the government will refund the tax returns and wages that it has since collected from borrowers when they defaulted. More than 100,000 of these borrowers have fallen behind severely on their debt, the department said, and about 800,000 were at risk of having their federal tax refund seized this year to repay a defaulted loan.
Individuals who made voluntary payments on any of their defaulted loans since the start of the pandemic can request a refund. Interest paid on those loans will also be returned.
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One year ago, the Trump administration told borrowers they wouldn't have to pay their student loan bills or worry about interest for 60 days, an order that's been repeatedly extended. In January, President Biden continued the moratorium through Sept. 30.