Felder Law Provides Tax Relief to Grieving Families

State Senator Simcha Felder‘s (D-Borough Park, Midwood, Flatbush, Kensington, Sunset Park, Bensonhurst) law providing tax relief to grieving families was signed into law last week. 

The new legislation, signed on Dec. 13 by Governor Andrew Cuomo, protects families already coping with tragedy and loss from additional financial hardship. Upon death or permanent disability, Federal law forgives any outstanding student loans due to an understanding that the loan was taken in good faith, but obviously can no longer be repaid. However, until now New York State did not fall in line with this policy. 

Bill A-6601, amends the tax law so that effective immediately the full dollar amount of the loan is no longer taxed at all. The new measure would amend New York State tax code so that a forgiven loan would no longer be counted as income to the family.