WASHINGTON – Today, Education and Labor Committee Chairman Robert C. “Bobby” Scott (D-VA), along with Ways and Means Committee Chairman Richard E. Neal (D-MA), Senate Finance Committee Ranking Member Ron Wyden (D-OR), Senate Health, Education, Labor, and Pensions (HELP) Committee Ranking Member Patty Murray (D-WA), and Ways and Means Committee Member Congresswoman Linda Sánchez (D-CA) called on the Department of Education (Department) to return all amounts garnished from the federal tax refunds of student loan borrowers since this year’s filing season began on January 27, 2020. The administration previously announced they would halt all collection activity on certain defaulted federal student loans during the COVID-19 emergency and would retroactively return $1.8 billion that had been garnished from borrowers since March 13, 2020.
In their letter to Education Secretary Betsy DeVos, the lawmakers called on the Department to extend the collection relief to more borrowers, including those who are more likely to be low-income. Traditionally, low-income taxpayers file their tax returns at the start of the filing season since they rely on their federal tax returns for essential expenses.
“In light of the COVID-19 pandemic, we are deeply concerned that the economic impact of these offsets could be even more devastating this year unless the money is returned immediately to these borrowers,” the lawmakers wrote. “Accordingly, we respectfully request that the Department return all amounts collected through offset of federal tax refunds for delinquent student loans since January 27 to taxpayer-borrowers.”
In 2019, about $3.2 billion was offset through the Treasury Offset Program (TOP) from low-income borrowers.
Full text of the letter is available here.
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