Dems Urge Education Dept. To Return Garnished Tax Refunds

The U.S. Department of Education should return funds it previously garnished from tax refunds of people behind on student loan payments to extend novel coronavirus relief to low-income people, five Democratic members of Congress said in a letter released Monday.

The department should return funds it has already garnished since Jan. 27 from tax returns, expanding its previous decision to roll back some of its collection activities in light of the COVID-19 pandemic, legislators including House Ways and Means Committee Chairman Richard Neal, D-Mass., and Senate Finance Committee ranking member Ron Wyden, D-Ore., said in the letter to Education Secretary Betsy DeVos, dated Friday.

Lower-income people tend to file income tax returns early because they rely on refunds, and tax return offsets made through the Treasury Offset Program to recoup delinquent student loans have likely already been made, according to the letter, dated Friday. In the 2019 filing season, the government garnished about $3.2 billion through the program from 1 million tax returns that had claimed refundable credits intended for lower-income people, the legislators said.

The department recently announced it would return around $1.8 billion it has already garnished from student loan borrowers, according to the letter.

--Editing by Robert Rudinger.

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