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Tax Offest USDEPTOFED/NAVIENT VS USA FUNDS

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Anonymous
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Tax Offest USDEPTOFED/NAVIENT VS USA FUNDS

So here is my dilemma. Last year my private loans with usa funds started to be garnished. They also said they would be taking my taxes. I thought no big deal. That would pretty much eliminate them.

The beginning of the year comes around. I find out my DEPTOFED loans are going to be garnished too, if I dont make payment arrangements. I immediately sign up for a rehab program and am on my 2nd month (yey).

My taxes end up being garnished, but the money goes to my DEPTOFED loans....even though I signed up for a rehab once I received my information from them...I responded within about 2 days.

Did I miss something in the mail? Can the DEPTOFED take the garnishment before USA FUNDS even though I have been in a garnishment with them for a year almost?

Message 1 of 3
2 REPLIES 2
SCF
Valued Contributor

Re: Tax Offest USDEPTOFED/NAVIENT VS USA FUNDS

It is entirely possible (and pretty likely) that the feds have set it up that seized tax returns go to paying back federal debts before private debts.  Unfortunately, starting rehab does not lift the offset on your tax returns, some (maybe all?) CAs will send that request once you make your sixth payment.  Of course, 4-6 weeks for processing generally on the IRS actually acknowleding said request.

 

I doubt there's anything to be done at this point.

Message 2 of 3
Anonymous
Not applicable

Re: Tax Offest USDEPTOFED/NAVIENT VS USA FUNDS

Plot Twist- I received a letter from Naviant dated March 26th stated that the US Dept of Ed was in the process of sending the garnishment to them... heres hoping its not just a mistake, but it looks like they already applied it to my Fed Ed Loans.

Message 3 of 3
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