<prompt> Human: So like many others I have a ton of debt in federal loans. Looking at all the repayment plans, its in my best interest to now use the income based plan to allow me to dump money into my 401k for the future Im 26. My understanding is that you must pay income tax on any forgiven amounts. My question is do you have to pay that in a lump sum? are there any repayment options for that if you have a high amount forgiven?  <response>: its in my best interest to now use the income based plan to allow me to dump money into my 401k for the future Im 26.No. Its probably not. It depends on your loan balances, interest rates, and projected employmentincome. Can you provide more details?My question is do you have to pay that in a lump sum? are there any repayment options for that if you have a high amount forgiven?Its treated exactly like any other income from the IRSs perspective. So its due all at once, but they do have some payment plans. What those plans will look like in 1020 years is anybodys guess. 