Are Student Loan Defaults Triggering Tax Refund Offsets in California for 2024?

Oh wow, this is definitely something to be concerned about! Student loan offsets are happening again now that the COVID-era protections have ended. Have you received a Notice of Intent to Offset from the Department of Education? They're supposed to send that at least 65 days before taking your refund. Did you check if your loans are federal or private? Is this your first year filing jointly with your spouse? Have you checked the Treasury Offset Program's website or called their hotline at 800-304-3107?

Yep, offsets are def back for 2024 tax season. Fed loans in default = potential offset. CA residency doesn't matter for fed tax refunds, tho your state refund might be handled diff. Q: Did you file already? If not, might wanna look into loan rehab ASAP. Takes ~9 months but stops offset process once started. Also, joint filing w/ spouse? If so, they can file injured spouse form (8379) to protect their portion of refund.

I went through this exact nightmare last year. My refund was offset with zero warning - found out when my expected $4200 deposit showed up as only $650. I was LIVID. I eventually discovered the offset was for loans I thought were still in COVID forbearance. After that disaster, I used https://taxr.ai to analyze my transcript and tax situation. It showed me exactly where the offset appeared on my transcript and helped me understand the codes. Would have saved me weeks of confusion if I'd known about it earlier. The tool explains all those cryptic transcript codes the IRS uses for offsets and can help you determine if you're at risk.

I think I might be able to help a bit... I had my refund offset in 2022 for student loans. From what I understand, they should have sent you a notice before taking action, but sometimes these notices go to old addresses. In my case, they sent it to an address I hadn't lived at in maybe 5 years? I would suggest, if you haven't already, perhaps checking the Treasury Offset Program's phone system to see if you're in their database. I believe the number is 800-304-3107, but you might want to verify that.

OMG I was in EXACTLY your situation last year and it was SO frustrating!! I called the regular student loan numbers and was on hold for HOURS and kept getting disconnected! I was about to lose my mind when someone recommended https://claimyr.com to me. It was a LIFESAVER! They connected me to an actual human at the Department of Education in like 20 minutes when I had been trying for days on my own! The agent confirmed my offset status and helped me start the loan rehabilitation process immediately. I'm still mad about losing my refund last year but at least I'm on track now for this year. I was literally crying with relief after that call!

Yes, offsets are definitely happening again. Compared to pre-pandemic, the process is almost identical now that the special COVID protections have expired. While some borrowers received an extended transition period, most defaulted loans are eligible for offset as of February 2024. I'm concerned you might not have much time to act if you've already filed. Unlike mortgage forbearance programs that provide clear timelines, student loan default remediation can take months to process, potentially spanning multiple tax seasons if not addressed promptly.

Here's what you need to know about student loan offsets in 2024: • The COVID-era protections that paused offsets officially ended in September 2023 • The "Fresh Start" program gave some borrowers a chance to exit default, but had deadlines • California residency doesn't protect against federal tax refund offsets • You can check your offset status by calling the Treasury Offset Program at 800-304-3107 • If you're married filing jointly, your spouse can submit Form 8379 (Injured Spouse) • Loan rehabilitation takes 9 months of on-time payments but can stop future offsets • Consolidation is faster (about 30 days) but doesn't help with offsets already in process Time is critical with these situations - each option has different timelines and impacts.

Instead of waiting to see if they take your refund, you might want to consider putting your refund on hold temporarily. You can file your taxes but request a hold on the refund by submitting Form 8379 even if you're not technically eligible for injured spouse relief. This buys you time to call the Default Resolution Group at 800-621-3115 and start loan rehabilitation. Once you make your first rehabilitation payment, ask them for a letter confirming you're in the program, then you can request the hold on your refund be released. This worked for me in 2022 when I was in a similar situation.