According to a person familiar with the situation, Biden will announce his choice at a White House event on Wednesday after returning from a two-week vacation.
More than 40 million Americans earning less than $125,000 have college debt of some kind.
Prior to the expiration of the most recent pandemic-related moratorium on federal student loan payments on August 31, Biden had committed to take action.
Additionally, he is debating whether to continue the one-time suspension of loan payments and interest. Payments were initially halted by President Trump in March 2020, and Biden has since given four extensions.
The federal government has already spent more than $100 billion as a result of the suspensions. The total amount of federal student loan debt owed by more than 40 million Americans is $1.6 trillion.
"Student debt cancellation will improve the wealth of millions of Americans who need it most and promote racial justice,. This will happen without raising inflation.