DOE Regulation Impact

Beginning in 2024 and beyond, employers are entitled to make matching contributions to an employer-sponsored retirement plan based on an employee’s qualified student loan payments because of new options introduced by the SECURE Act 2.0. Employers are subject to certain certification rules to ensure that employers are, in fact, making the student loan payments. Under IRS guidance, employers can independently certify (1) the amount of the loan payment; (2) the date of the loan payment; (3) that the payment was made by the employee. The Department of Education, however, has adopted new regulations via The Stop Student Debt Relief Scams Act that require student loan servicers to prevent third parties from accessing student borrowers’ data in an effort to prevent fraud.

We asked two professors and authors of ALM’s Tax Facts with opposing political viewpoints to share their opinions about whether the Department of Education regulations will negatively impact the availability of the employer-sponsored student loan match.

Below is a summary of the debate that ensued between the two professors.