ICYMI: WSJ Article Features Davis Legislation as Solution to Addressing Rising Student Debt
U.S. Rep. Rodney Davis’ (R-Ill.) legislation, the Employer Participation in Student Loan Assistance Act, to engage employers and help graduates pay off their student loans more quickly, was featured in a recent Wall Street Journal article as the ‘proposal with the most traction’ to address rising student loan debt.
Below are exerts from the WSJ article written by Josh Mitchell:
A tripling of student debt over the past decade to more than $1.3 trillion has unleashed a torrent of Washington lobbying from outside the education sector, with various industries describing a “crisis” requiring federal intervention…
But many industries argue that freeing up student debt, even for well-paid workers, would help the economy. The National Association of Realtors says student debt is a big factor behind a drop in the share of younger Americans owning homes, with the debt preventing them from saving for down payments…
The proposal with the most traction would allow employers to contribute up to $5,250 a year toward an employee’s student debt without it being taxed. Currently, such contributions are treated as ordinary income and subject to income and payroll taxes. The bill would increase the amount of net compensation an employer could give to a worker while saving him or her hundreds of dollars in taxes...
“Graduates who aren’t able to invest in their 401(k), who aren’t about to go out and buy a home and start a family because they’re worried about paying their student debt,” [Davis] said. “It would allow them an alternative.”
Read the entire WSJ article here: http://www.wsj.com/articles/soaring-student-debt-prompts-calls-for-relief-1473759003