Education Department delays collections on defaulted student loans

The Education Department announced a temporary delay to wage garnishments and other involuntary collections for federal student loan borrowers in default, saying the pause will allow it to implement repayment reforms under the Working Families Tax Cuts Act.

The Education Department announced a temporary pause on implementing wage garnishment and other involuntary collection actions for borrowers with defaulted federal student loans. The announcement said the pause covers collections through wage garnishments and the Treasury Offset Program, which can seize tax refunds and some benefit payments. The department described the delay as temporary and said it will support implementation of repayment reforms under the Working Families Tax Cuts Act. The statement was issued by the Education Department on Friday. Key points: - The department announced a temporary delay to involuntary collections for defaulted federal student loans. - The delay affects wage garnishments and the Treasury Offset Program, which can seize tax refunds and some benefits such as Social Security payments. - The department said the pause is intended to allow implementation of repayment reforms under the Working Families Tax Cuts Act. - The announcement described the delay as temporary and did not specify a return date. Summary: The pause stops certain involuntary collection actions while the Education Department prepares to implement major repayment changes under the Working Families Tax Cuts Act. Undetermined at this time.