I have student loans that are in default. Short version is that I lost my job last year along with my home and am now going through a divorce. I found a contractor position with the US Census Bureau, went through the bid process and was awarded a contract that started the beginning of July 2010 and goes through Sept 2011. A Tax Offset was placed on me in January due to my student loans being in default.
Now since I am a contractor and my business was under my SSN my invoices are being intercepted to pay the tax offset. The problem is that it will take 3 months or more to repay 100% of the student loan back. I was told that my offset is for 99% of the payments. Essentially I will be paid 0 for the work I do. What can I do to stop this. I found this out when calling the Student loan people to establish a repayment program. The program would require me to make 3 months of on time payment and the hold would be released... Help
2 Answers from Attorneys
That sounds odd, that you did not receive notice of collection efforts before a garnishment proess began. . I think that you need to start at the beginning and provide all details. At tax offest and garnishment process usually starts down the line.
On the bright side, you are not really working for free since the garnishment will result in a reduction of your debt and that debt is not dischargeable in bankruptcy.
That sounds odd, that you did not receive notice of collection efforts before a garnishment process began. Please provide more details concerning notice, etc. tax offsets and garnishment processes happen after an opportunityu for a hearing.
On the bright side, you are not eally working for free since the garnishment will result in a reduction of your debt and that debt is not dischargeable in bankruptcy.