In an article published by the Nashville Business Journal, Bass, Berry & Sims attorney Doug Dahl discussed student loan repayment benefits offered by employers and the IRS’s ruling last year regarding this issue. Student loan debt in the United States is escalating, and employers are finding it harder to fill open positions. In an effort to tackle both of these issues, more employers have been offering student loan repayment opportunities as part of the benefits packages they offer employees.
For example, employers can offer student loan debt management programs that offer counseling services and access to student loan marketplaces or more favorable finance terms. In May 2018, the IRS issued a ruling allowing an employer to make contributions to its 401(k) plan on behalf of employees who make payments toward their student loan.
“In other words, the employees pay down their student debt, and their employer matches that with a contribution to their 401(k) accounts, which is not currently taxable. Although the IRS’s ruling was issued to a specific employer and may only be relied upon by that employer, many believe the ruling will fuel interest among other employers and garner more widespread approval from the IRS.”
The full article, “Legal View: New IRS Ruling May Offer Student Loan Repayment Relief,” was published in the print and online editions of the Nashville Business Journal on May 31, 2019.