Hello, My wife is in year 9 of her PSLF/ IBR. IT is a 10 year plan. My income is significantly higher then hers so we file our taxes separately. As a result we have been missing out on tons of tax benefit in order to keep her monthly payment down. As we approach her last 12-15 payments I am hoping to file next year’s taxes (2020) jointly. In my estimation, by the time the program is able to see the increased combined income she will have already made nearly all of her remaining payments. Perhaps there would be 1-2 remaining payments at a much higher rate but I expect the tax benefit would outweigh these. I just want to make sure there are no hidden penalties for doing this. Id appreciate your insights. Thanks
May 3, 2014
It sounds like you are considering all of the appropriate variables. I think you just need to run the numbers on both options to see what the math says.
Has your wife been certifying her payments? If not, I’d encourage you to do that to get an updated tally on the countdown to the 120 necessary payments. Any deviation from what you expect could change your plans.
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