Exempts discharge of student loan debt of certain veterans through the federal Total and Permanent Disability discharge process from taxation under the gross income tax.
Impact
If enacted, A655 would modify existing tax statutes in New Jersey to specifically exclude forgiven student loan amounts from the taxable income of veterans who meet specified disability criteria. By reinforcing this exemption, the bill recognizes the unique challenges faced by veterans who are unable to work due to service-related disabilities and thus aims to ease their financial obligations in a significant way. This change could lead to increased disposable income for affected individuals, empowering them to invest more heavily in their post-service lives.
Summary
Bill A655 aims to provide financial relief for totally and permanently disabled veterans by exempting discharged student loan debt from being included in their gross income tax calculations. This provision targets veterans who qualify under the Total and Permanent Disability discharge process instituted by the U.S. Department of Education. By alleviating the tax burden associated with discharged student loans, the legislation intends to support disabled veterans in their pursuit of financial stability after military service.
Sentiment
The sentiment surrounding A655 is overwhelmingly positive, particularly from veteran advocacy groups and lawmakers sympathetic to the needs of disabled veterans. Supporters typically describe the legislation as a much-needed step toward acknowledging the sacrifices of veterans while providing tangible assistance as they navigate their post-service lives. There is, however, an underlying concern regarding the potential long-term impacts on state revenue, which has been a consideration in discussions around fiscal responsibility continuous support mechanisms for veterans.
Contention
While A655 does not appear to face significant opposition, the broader implications of tax exemptions on state revenue and budgeting processes could be points for future contention. Legislators and stakeholders may need to consider these aspects in discussions about funding for veteran programs and services. Additionally, advocates for fiscal conservatism may raise questions about the precedent set by granting tax exemptions for specific groups, urging a balance between support initiatives and broader tax equity.
Same As
Exempts discharge of student loan debt of certain veterans through the federal Total and Permanent Disability discharge process from taxation under the gross income tax.
Exempts discharge of student loan debt of certain veterans through the federal Total and Permanent Disability discharge process from taxation under the gross income tax.
Income tax; exclude forgiven, cancelled or discharged federal student loan debt under the Public Service Loan Forgiveness Program from the definition of "gross income".