You have defaulted on student loans can they garnish your taxes?

Answer 1

Answer

Tax refunds cannot be directly seized by a creditor judgment.

The IRS can seize tax refunds without the use of due process for federal taxes owed.

State and federal tax refunds can be seized for child support arrearages.

Answer 2

Yes, if you are default on your student loans, then your name will be added to the tax offset list by the Dept. of Ed.

So your income tax fund check will be applied to your default student loans.

If you need help getting out of default and getting the garnishment lifted, a company called Default Management Services, Inc. can help you. Google the company name to get the phone #. Ask for Doug, he is knowledgeable.

Answer 3

Yes, income tax refunds are withheld once Federal student loans are in a Default status.

There are only 2 ways to get out of default on your Federally Guaranteed student loans.

1. Contact your collection company or student loan servicer and request to enter the rehabilitation program. Most people qualify, but I have seen some refused when the default is over 10 years old. In the rehabilitation program, you will need to make 9-12 on-time payments in addition to your garnishment. After the 9-12 on-time payments, they should stop the garnishment, but you will stay in a default status until your Rehabed loans are sold to a new lender. In the past, that was an easy process, but in these turbulent financial times, other lenders are not buying rehabed loans. So, with this option your loans will stay in a Default status for the forseeable future.
2. The second way you can get out of default and have your garnishment lifted is to consolidate your loans. These days very few Federal lenders will consolidate defaulted loans and your lender will probably not release the loan for consolidation while in a garnishment stage. The good news is, there are a few companies out there that will help you get a garnishment lifted and find a Federal lender to consolidate the loans. One good example is Default Management Services, Inc. They are the cheapest I have seen and give a 100% money back guarantee on their services. You can Google the company name to get the phone #. Ask for Doug.

Answer 4

If you are in the U.S., then the answer is definitely yes. You still have time to get out of default before filing your tax return.

There are only 2 ways to get out of default on your Federally Guaranteed student loans.

1. Contact your collection company or student loan servicer and request to enter the rehabilitation program. Most people qualify, but I have seen some refused when the default is over 10 years old. In the rehabilitation program, you will need to make 9-12 on-time payments in addition to your garnishment. After the 9-12 on-time payments, they should stop the garnishment, but you will stay in a default status until your Rehabed loans are sold to a new lender. In the past, that was an easy process, but in these turbulent financial times, other lenders are not buying rehabed loans. So, with this option your loans will stay in a Default status for the forseeable future.
2. The second way you can get out of default and have your garnishment lifted is to consolidate your loans. These days very few Federal lenders will consolidate defaulted loans and your lender will probably not release the loan for consolidation while in a garnishment stage. The good news is, there are a few companies out there that will help you get a garnishment lifted and find a Federal lender to consolidate the loans.

If you need additional help getting your loans out of default, click on my user name, "studentloaner", below.

Answer 5

Taxes are paid to the government, and are not included in your wages. They will take the money that is yours only, not that which should be the government's.

Yes, a tax return can be garnished, as it is your income and has the same restrictions as any other form (barring taxes, since it has already been taxed).

Answer 6

Presuming it's a Gov't loan and garnishment...yes.

Answer 7

If it is from a government guranteed or insured loan, by the time your being garnished, the IRS has been notified and will take any refund and send it to who you owe.

Answer 8

They certainly can take them. They'll let you know if they're going to.

Answer 9

If you owe back child support then yes, they will still take your taxes even through your wages are garnished.