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I enrolled in architecture school in 2009 at a university that pitched large scholarships and a manageable debt burden (<75K). I l eft graduate 180K in student debt, even after working consistently as a TA during the school year and as an architectural intern in the summer.

Since graduating, I enrolled in an income-based program, and consistently make on-time payments, yet the 7.75% interest rate on my federal loans has prevented me from keeping up with the interest. My loan balance is now 240K+.

The income-based program promises forgiveness after 25 years, but the US tax code currently views the forgiven balance as taxable income. My projected loan forgiveness balance is close to 500K. This would sidle me and my family with a tax bill of 100K+. Unfortunately my wife is in a similar situation.

Despite our monthly payments, we are still able to make rent and pay our other bills, however we have not been able to accrue any significant savings for a home or for the expenses of having children.

The key changes that could be made in the US system:
- set reasonable (Fed-based?) rates for student loans.
- allow loans to be paid pre-tax, or increase the tax deductible limit of loan interest
- adjust the tax code to prevent taxation of forgiven balance

These simple changes would allow this generation to move forward with major life-steps, like buying property and starting families - good things for the economy.

Justin Halsey    May 22, 2018    Brooklyn   

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