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Congressman proposes tax breaks for businesses that help pay student loan debt for employees

Illinois Watchdog.Org

Thursday, August 9, 2018  |  Article  |  By Greg Bishop

Candidates--Federal (13) , Education--Higher (37)

Isabella Stockton lives in Alton and recently graduated from Lewis and Clark Community College for welding and works in the trade. But the working mother is still struggling with student loan debt.

“I have my student loans that I have to pay off … and it’s hard to pay it off when I’ve got everything else I have to take care of with my son, hospital bills and stuff like that,” Stockton said.

U.S. Rep. Rodney Davis, R-Taylorville, said the student loan debt problem is in the tens of billions of dollars and that looms. He has a proposal he said would use the tax code to incentivize employers to help their employees pay down student loan debt.

“What we want to do is allow employers to do for student debt what they do for tuition reimbursement now,” Davis said. “They can give tax free to an employee $5,250 a year in tuition reimbursement. Let’s make it the same for debt. Let’s make sure that recent grads who have debt can go to their employers and negotiate that as part of their plan.”

Davis said it’s a better idea that having taxpayers pick up the tab for defaulted students loans. 

“I’d rather incentivize employers to help students and families get out of debt,” Davis said. “Why not?”

Ivanka Trump, adviser to the president, took part in a workforce development roundtable discussion Wednesday at Lewis and Clark Community College and approved of Davis’ idea.

“I was studying it on the plane,” Trump said. “I think it’s a brilliant idea.”

Forbes reported the U.S. student loan debt in 2018 is a $1.5 trillion crisis, with the average debt per student in 2016 being more than $37,000. The delinquent balances for all student debt was $32.6 billion, according to Forbes.