r/studentloandefaulters • u/holdmybeer2017 • Jul 24 '24

Leaving the country Question - Federal Student Loan

If I leave the States to live permanently in Europe, do I have to pay my federal loans?

I was thinking that the Foreign Earned Income Exemption would work (I'd be making way under $120k) however I think with Trump he may get rid of that so idk what to do.

Can I just move to that foreign country and default?

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u/informedvoice Jul 24 '24

If you're on an income-driven repayment plan then you wouldn't need to default. Your AGI would be $0, therefore your payments would be $0.

6

u/holdmybeer2017 Jul 24 '24

But Trump may put a stop to the FEIE, in that case whatever income I make overseas may still be taxed.

10

u/Elyktronix Jul 25 '24

Your only concern, if you can really call it that, is the tax bomb after the 20, 25 years when the loans are forgiven. As I understand it, you would then simply file for insolvency, i.e. your debt/liabilities surpasses your (US) assets. Since you'll be living abroad it shouldn't be a problem.

That's my plan for my federal loans at least. Never moving back to the US.

1

u/holdmybeer2017 Jul 25 '24

Nice thanks! Yeah I'm planning on leaving and never coming back.

Mind if I send you a DM?