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Old 06-01-2010, 11:47 AM   #1
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Does SSDI withhold backpay for fed student loans?

Ok so another question I recently got my back pay but It was about 8,000 less than expected but just about what I owe is federal student loans. Student loan people sent me a letter last month saying they were going to garnish my montly checks but said nothing about just taking it from back pay. Has this happened to anyone? or am I missing money and they can only take it out 15% montly? any help appreciated...thanks

 
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Old 06-01-2010, 01:26 PM   #2
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Re: Does SSDI withhold backpay for fed student loans?

they can take up to 15%. But the first $750 (of every monthly benefit) is safe. So, if I get 850 a month, they can't touch the first 750, only $100 even if it's not 15%. So I'd make sure that it's equal to that or less.
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Old 06-01-2010, 06:21 PM   #3
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Re: Does SSDI withhold backpay for fed student loans?

SS can go back to each month in which you would have received SSDI benefits thus take it out of back pay. So lets say they would have removed $200 each month and your benefits should have begun 1/1/09, then they can take $200 per month for the last 18 months $3600.

Ask SS for a full accounting of where the benefits went and they should be able to show you the calculation. Keep in mind Student Loan debt will follow you wherever you go, it can never be discharged even under bankruptcy. Many loans are government backed loans and SS is a federal program so they can match up information.

There are circumstances where student loans can be forgiven if you are disabled. BUT only from the date of disability forward. So, if you owed $8000 and didn't pay for 10 years prior to your disability, they can take the 10 years worth. So if this is past due they will get you now or later, so better to get it out of the way.
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Old 06-13-2010, 03:30 PM   #4
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Re: Does SSDI withhold backpay for fed student loans?

Quote:
Originally Posted by SpineAZ View Post
SS can go back to each month in which you would have received SSDI benefits thus take it out of back pay. So lets say they would have removed $200 each month and your benefits should have begun 1/1/09, then they can take $200 per month for the last 18 months $3600.

Ask SS for a full accounting of where the benefits went and they should be able to show you the calculation. Keep in mind Student Loan debt will follow you wherever you go, it can never be discharged even under bankruptcy. Many loans are government backed loans and SS is a federal program so they can match up information.

There are circumstances where student loans can be forgiven if you are disabled. BUT only from the date of disability forward. So, if you owed $8000 and didn't pay for 10 years prior to your disability, they can take the 10 years worth. So if this is past due they will get you now or later, so better to get it out of the way.
Yes, student loans can be offset by back Social Security benefits of any kind, but they would have to be in default. If your loan was in default status at the time they issued your back award check, then it is very possible that these funds were offset at the Federal level.

Last edited by wd1976; 06-13-2010 at 03:31 PM. Reason: wrong reply

 
Old 06-17-2010, 05:02 PM   #5
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Re: Does SSDI withhold backpay for fed student loans?

Hi, I owed on a student loan, was fully in default, but I still received all of my back pay. This was back in 1998 and it seems quite abit has changed since then. However, when the stimulus benefit was given, mine was kept for my student loan. Good luck..

 
Old 05-30-2011, 08:44 AM   #6
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Re: Does SSDI withhold backpay for fed student loans?

Quote:
Originally Posted by SpineAZ View Post
SS can go back to each month in which you would have received SSDI benefits thus take it out of back pay. So lets say they would have removed $200 each month and your benefits should have begun 1/1/09, then they can take $200 per month for the last 18 months $3600.

Ask SS for a full accounting of where the benefits went and they should be able to show you the calculation. Keep in mind Student Loan debt will follow you wherever you go, it can never be discharged even under bankruptcy. Many loans are government backed loans and SS is a federal program so they can match up information.

There are circumstances where student loans can be forgiven if you are disabled. BUT only from the date of disability forward. So, if you owed $8000 and didn't pay for 10 years prior to your disability, they can take the 10 years worth. So if this is past due they will get you now or later, so better to get it out of the way.
Thanks SpineAZ for all your help on this forum

My question is related to the above,but lets say you also owe IRS debt AND a student loan.

1) Can they take BOTH from your back-pay/monthly check?

2) If so,how much can each take or is there a limit? I was told IRS limit is 15% and Student loan is 10%?

3) As you stated above can they take it out of your back pay based on that percentage they will be deducting each month?

4) Is there a hardship application potential for each entity PRIOR or is it done automatically?

You are truly remarkable in all the work you do on this board.I am sure I am not alone in this feeling

Ferd144

 
Old 05-30-2011, 09:15 AM   #7
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Re: Does SSDI withhold backpay for fed student loans?

Child support, student loans, back taxes due>>>>>>isn't the total max. percentage 25%?

 
Old 05-30-2011, 09:21 AM   #8
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Re: Does SSDI withhold backpay for fed student loans?

Sorry, I don't know what the specific rules aren't student loan debt that is federal fan be adjusted under the Income Based Repayment Plan where they set up what you owe based on your income and you pay that amount for I believe 20 yr. If you do so, at the end of 20 yr the remaining amount is forgiven. Private student loans (such as thru a bank) aren't as generous in this way. In either case you should see what happens if you are disabled. You'd still owe any gvt based loans fully before your date of disability but I believe gvt loans are forgiven from the date of disability if permanent. In that case you still owe any back due loans and interest which occurred before disability. Not sure how that works with private student loans.

You'd have to ask the IRS for any provisions they have for people who are disabled. If you've managed to survive all this time it's probably best to use back due SS to wipe out as much of the debt as you can and negotitate "you say I owe you $20,000. I am now on SSDI and receieved a lump sum of back benefits due of X amount. Based on my new low income due to disability would you settle for $10,000 as full payment. If so I will pay you immediately upon written proof that you agree to settle.

If you have a spouse with income negotiation is less likely to work.

Student loan debt can't be discharged in bankruptcy in most cases and same goes for IRS debt. BUT in some cases they so consulting a bankruptcy atty may help. Are each amounts hefty or were you just unable to pay recent taxes and close to the end of student loan debt?
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Old 05-30-2011, 09:28 AM   #9
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Re: Does SSDI withhold backpay for fed student loans?

Student loan < 10K and IRS ~$30k......back-pay ~ 35k and monthly expected SSDI payment is ~ 1350

Thanks AGAIN SpineAZ,as I have learned from you(and this forum) MORE than any attorney,agency,etc I have dealt with

Any suggestions welcome

Ferd144

 
Old 05-30-2011, 09:41 AM   #10
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Re: Does SSDI withhold backpay for fed student loans?

Quote:
Originally Posted by BlueSkies14 View Post
Child support, student loans, back taxes due>>>>>>isn't the total max. percentage 25%?

Thanks BlueSkies14m

That is the *assumption* I have come to as well.The total/max deduction can be NO MORE than 25% of the total back pay/monthly check ?

Once again I cant express in words how much this forum has helped me

Happy Memorial Day to all(esp those who have served our country)

Ferd144

 
Old 05-30-2011, 09:43 AM   #11
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Re: Does SSDI withhold backpay for fed student loans?

Ask each if there are any provisions for forgiving loans when disabled as you've now. Been approved for SSDI. If the student loans are federal loams there may be, begin the process to ask debt be forgiven based on permamt disability. If it's private loans this can be harder and then perhaps make a settlement offer and they must do so in writing. IRS can be tougher, but see if settlement is an option and dont pay one of these bogus "we help you settle with IRS" firms you see on TV. Many of them have recently been in big trouble. Keep in mind SS and IRS are both government entities so IRS could be alerted to SS award and backpay. If you have any crucial bills to pay out of the back pay due it ASAP (like paying off car, back rent, back bills).

If you have other household income and can survive on SS, pay off the IRS if you can and negotiate with any federal student loan provider based on disability. Better to get them all off your hack and go forward not wondering if a check will be garnished, etc.
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Old 05-30-2011, 10:07 AM   #12
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Re: Does SSDI withhold backpay for fed student loans?

Quote:
Originally Posted by SpineAZ View Post
Ask each if there are any provisions for forgiving loans when disabled as you've now. Been approved for SSDI. If the student loans are federal loams there may be, begin the process to ask debt be forgiven based on permamt disability. If it's private loans this can be harder and then perhaps make a settlement offer and they must do so in writing. IRS can be tougher, but see if settlement is an option and dont pay one of these bogus "we help you settle with IRS" firms you see on TV. Many of them have recently been in big trouble. Keep in mind SS and IRS are both government entities so IRS could be alerted to SS award and backpay. If you have any crucial bills to pay out of the back pay due it ASAP (like paying off car, back rent, back bills).

If you have other household income and can survive on SS, pay off the IRS if you can and negotiate with any federal student loan provider based on disability. Better to get them all off your hack and go forward not wondering if a check will be garnished, etc.
Been approved for SSDI:

I have been approved as of last week,and wondering is it in my best interest to *nip this at the bud"? In other words should I call IRS now along with Dept of Education(small student loan for my son) to set up a payment plan OR hardship case which is the primary problem

Obviously my attorney is/will/could care less ,as he will likely be paid FIRST according to other members?

I am bamboozled and dont want to do the wrong thing nor stir the pot,as I do owe the both debts but my SSDI/back-pay will be pummeled by either issue

Thanks so much,
Ferd144

 
Old 05-30-2011, 10:20 AM   #13
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Re: Does SSDI withhold backpay for fed student loans?

How much back debt in total are we talking about ferd144?

 
Old 05-30-2011, 10:22 AM   #14
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Re: Does SSDI withhold backpay for fed student loans?

Federal student loans (even for your son if it's solely a loan you took out) may be eligible for partial to full forgiveness. Contact them, tell them you have your proof of SS Disability approval and how can you apply for loan forgiveness. (This applied to federal student loans but not to private loans for the most part). Once approved you owe nothing and loan is forgiven.

In order to do anything you must have your SS approval letter which states date SS found you disabled, monthly benefit amount, etc. Also ask your SS atty for copies of all medical info he may have as the SS approval letter alone may not be sufficient, they may need medical proof.
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Old 05-30-2011, 10:24 AM   #15
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Re: Does SSDI withhold backpay for fed student loans?

As of my last SS statement......it is ~ 53k

 
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