NHSC program 2015 comparing the 2 programs and tax break

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Anyone know or can explain the tax break for the two different programs that NHSC offers for loan repayment?

I was looking at their site and one said it is taxable, taxes are taken out prior to disbursement, and the other states it is not taxable?

http://www.hrsa.gov/loanscholarships/repayment/nursing/bcrsloanrepaymentfactsheet.pdf

I'm just trying to figure out which would be more cost effective. The amount will not pay off my loans and have calculated the taxable loan will give me about 54K and the non-taxable 50K for 2 years. So, now I'm an a little confused if the one that I will get more, but taxed will average out, and will it increase my annual income to increase my tax bracket. Any advice would be greatly appreciated.

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NELRP is definitely taxed. They take out about 30% before they give it to you. In my case, the offer on paper looked like NELRP was going to give me substantially more money than NHSC. After taxes it is the exact same repayment amount.

i was concerned that the NELRP tax thing was going to screw up my income taxes, but it hasn't at all.

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Specializes in family practice.

I will say to look at the contract really well before you sign anything.

Although I am not aware of NHSC, I know the IHS loans are taxable income. For example if you receive 20k in loan, taxes will be taken out before it is disbursed (little above 18k will be deposited) and since IHS also pays a portion 24k will be reported on your taxes.

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