Is Student Loan Forgiveness Taxable in 2026?
Whether forgiven student debt counts as taxable income depends on the type of forgiveness and the year. Here is the federal picture for 2026.
| PSLF | Not taxable as federal income. |
|---|---|
| Teacher Loan Forgiveness | Not taxable as federal income. |
| NHSC, Nurse Corps and other health-profession loan repayment | NHSC loan repayment funds are exempt from federal income and employment taxes, according to HRSA. Other programs vary; ask the administrator. |
| Death and total and permanent disability discharge | Excluded from federal income. |
| Income-driven repayment (IDR/RAP) forgiveness | The temporary exclusion for IDR forgiveness covered discharges through Dec 31, 2025. Forgiveness after that can count as taxable income. Your servicer may send IRS Form 1099-C. |
| State loan repayment awards | Varies. Some are taxable income; ask the program. |
State income tax can differ from federal rules. Check your state's revenue department.
Sources: Federal Student Aid, PSLF ↗ · IRS Topic 431, Canceled debt ↗ · HRSA NHSC ↗. Last checked Oct 21, 2026. Not tax advice; talk to a tax professional.
Is student loan forgiveness taxable in 2026?
PSLF and Teacher Loan Forgiveness are not taxable federally. Income-driven repayment forgiveness after Dec 31, 2025 can be taxable federal income.
Is NHSC loan repayment taxable?
HRSA says NHSC loan repayment funds are exempt from federal income and employment taxes.