Libertarian group sues to block student debt cancellation

KIFI

Published September 27, 2022 9:29 AM

By COLLIN BINKLEY
AP Education Writer

A libertarian group in California filed a legal challenge to President Joe Biden’s plan for student debt cancellation on Tuesday, calling it an illegal overreach that would increase state tax burdens for some Americans who get their debt forgiven. The lawsuit was filed by the Pacific Legal Foundation and is believed to be the first targeting Biden’s plan. It was filed in federal court in Indiana, one of several states that plan to tax any student debt canceled by Biden’s plan. It argues that some borrowers will automatically get tax relief but then face a state tax increase. Some other federal programs offer to forgive their debt without any tax.

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