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Several states recently announced plans to distribute more stimulus funds. More details on Biden’s student loan forgiveness plan emerge while Republicans send a letter to Biden over his student loan handout.
Although the federal government has not authorized a fourth stimulus payment, several states have recently announced plans to distribute more funds to residents. In fact, almost half of all US states have already paid out stimulus money or will soon do so.
Hawaii announced plans to send out the first wave of $300 stimulus checks due to arrive on September 12 to taxpayers earning less than $100,000, Marca reported.
Recently lawmakers in New York and Pennsylvania have announced plans to distribute stimulus payments. Roughly 1.75 million people across New York will receive a $270 payment, while residents in Pennsylvania could see as much as $1657.50, the Motley Fool reported.
Many new details have emerged regarding president Joe Biden’s student loan forgiveness plan. The application for canceling debt should be ready by next month (October), CNBC reported.
Low-income students who received a Pell Grant can receive up to $20,000 in loan forgiveness, while those who did not receive a Pell grant may see up to $10,000 in loan forgiveness.
In the broad picture, approximately 37 million student loan borrowers will be eligible for forgiveness based on their type of loan as long as they also fall under the income limit.
The amount of loan relief is capped at the amount of the borrower’s outstanding eligible debt. Loans taken out after June 30, 2022, will not be eligible for the relief.
The student loan relief will not trigger a federal tax bill. However, some states may still levy taxes.
A group of 22 Republican governors, led by Iowa Gov. Kim Reynolds, sent a letter to President Biden on Monday expressing their concerns over his student loan forgiveness plan. The handout is estimated to cost taxpayers $500 billion.
In the letter, the governors said the plan will negatively impact lower-income families, “punish the poor,” and shift the “burden of debt from the wealthy to working Americans,” Fox reported.
In the letter, the governors complained Biden’s loan forgiveness plan was “estimated to cost the American taxpayer more than $2,000 each or $600 billion total … Only 16-17 percent of Americans have federal student loan debt, and yet, your plan will require their debts be redistributed and paid by the vast majority of taxpayers.”
“Shifting the burden of debt from the wealthy to working Americans has a regressive impact that harms lower income families,” the governors argued in the letter. “Borrowers with the most debt, such as $50,000 or more, almost exclusively have graduate degrees, meaning hourly workers will pay off the master’s and doctorate degrees of high salaried lawyers, doctors, and professors.”
