Student debt repayment and the CARES Act: What to know
Employers can now help their employees pay down student debt faster and save a significant amount of money on student loan interest.
By Tara Fung |
May 12, 2020 at 10:39 AM
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Much has been written about provisions in the CARES Act that support student loan borrowers. Particularly, the provision enabling student loan borrowers to pause payments and interest on their student debt for close to 6 months is recognized as an effective way to free up much-needed cash during this period of economic uncertainty.
What has largely been overlooked is part of the CARES Act that allows employers to make tax-free contributions directly to employee student loans. This allows employers to help their employees pay down student debt faster and save a significant amount of money on student loan interest over time. This feature was included in the stimulus package as a temporary form of legislation this readership likely knows a lot about: the Employer Participation in Repayment Act, otherwise known as EPRA.
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