Boston Student Loan Lawyer

Law Office of Adam S. Minsky

7 Student Loan Tax Tips for 2018

| Articles Current Events Income-Based Repayment Income-Driven Repayment Loan Forgiveness Pay-As-You-Earn Policy & Reform Student Loans 101 Taxes

What’s more stressful than student loans and taxes? Not much. But don’t get paralyzed. Here are some tips to guide you as we enter the height of tax season.

Student Loan Interest Is Still Tax Deductible

For many years, the tax code permitted many borrowers to claim a portion of their student loan interest paid as a deduction on their tax return. This deduction was threatened during the congressional battle over the tax bill last year. However, the final version of the tax bill preserved this tax deduction. So if you received a 1098-E statement issued by your student loan lender (which would show the amount of interest that you paid during 2017), you may still be able to claim some of that as a deduction. Remember that the deduction is capped, however, and is also phased out for higher income earners.Read More

BREAKING: Budget Targets Loan Forgiveness and IDR Programs

| Articles Current Events Default Income-Based Repayment Income-Driven Repayment Loan Forgiveness Pay-As-You-Earn Policy & Reform

The Trump administration released a budget blueprint yesterday, outlining how it wants Congress to address government spending. The proposal calls for sweeping changes to student loan programs – reforms that would have a major national impact. Here are some specifics:

  • Public Service Loan Forgiveness (PSLF) would be eliminated.
  • Current Income-Driven Repayment (IDR) programs like Income Based Repayment (IBR), Pay As You Earn (PAYE), and Revised Pay As You Earn (REPAYE) would be eliminated, and a new IDR plan would take its place. This plan would have payment amounts somewhere between PAYE/REPAYE and IBR, with a shorter repayment term (15 years) for undergrads and a longer term (30 years) for grad students.
  • Subsidized federal loans would be eliminated, meaning all federal loans would accrue interest at all times, even during periods of in-school deferments.

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Surge in Sallie Mae and Navient Collections Lawsuits

| Articles Current Events Default Private Student Loans

During the past few months, I have seen a fairly rapid increase in new collections lawsuits being filed against student loan borrowers in Massachusetts for defaulted student loans that were previously held by Sallie Mae and/or Navient. This is noteworthy because in my experience, these loans had been predominantly placed with non-attorney third-party debt collection agencies, or out-of-state collection law firms that rarely filed suit. This is a major shift.Read More

Government Shutdown: What Student Loan Borrowers Should Expect

| Articles Current Events Income-Driven Repayment Taxes

At midnight on Friday, January 19, 2018, the federal government officially shut down after congressional Democrats and Republicans, and President Trump, could not agree on a compromise to continue funding the government. When the government shuts down, it means that nonessential employees are sent home without pay, and federal agencies cease most nonessential operations, until the impasse is resolved.

With $1.4 trillion in outstanding student loan debt – much of it held by the federal government – many student loan borrowers are feeling nervous about how this shutdown may impact their student loans. The good news is that I expect any direct impacts to be fairly minimal for most student loan borrowers. However, certain people will definitely experience some disruption. Here’s my take on what to expect. Read More

7 Ways to Lose a Student Loan Lawsuit

| Articles Default Private Student Loans Student Loans 101

Getting sued on a defaulted student loan can be overwhelming and terrifying. In my experience, most people who are brought to court by student loan debt collectors have never been sued before, so they don’t know what to expect. And dealing with debt collectors, attorneys, court personnel, and judges can be intimidating and embarrassing.

However, being sued does not mean all is lost. The initiation of a lawsuit is the beginning of a legal process, not the end. You have rights, and you may have some options. The lawsuit could end in any number of ways ranging from a dismissal of the case, to some sort of negotiated agreement, to a judgment against you. While no one (not even me) could tell you with any certainty what the final outcome of a student loan lawsuit may be, I can tell you that doing certain things may ensure that you lose.Read More

Student Loan Law End-of-Year Review

| Articles Current Events For-Profit Colleges Income-Based Repayment Income-Driven Repayment Loan Forgiveness Pay-As-You-Earn Policy & Reform Private Student Loans Taxes

Well, 2017 has been quite an explosive year, hasn’t it? And there’s been a lot going on in the world of student loan law – so much, in fact, that it can be a bit overwhelming to keep everything straight. So as we wrap up this year, here’s an overview of what went down for student loan borrowers, and some hints of what’s to come in 2018.Read More

BREAKING: Major Changes Proposed for IBR and Loan Forgiveness

| Articles Current Events Income-Based Repayment Income-Driven Repayment Loan Forgiveness Pay-As-You-Earn Policy & Reform

News outlets are reporting that the House GOP has drafted legislation that could reshape the entire federal student loan system.

The bill is called the “Promoting Real Opportunity, Success and Prosperity Through Education Reform Act,” or the “PROSPER Act.” The full text of the proposed bill has not yet been released, but an outline of the proposal was released to the media. Here’s what we know (and what we don’t know):Read More

BREAKING: Tax Bill Targets Student Loan Borrowers

| Articles Current Events Policy & Reform Taxes

Late this week, the House GOP unveiled its much-anticipated tax reform bill. The bill makes a lot of reforms to the tax code for both individual and corporate taxpayers. There are some major changes proposed for student loan borrowers.

First, the bill eliminates the student loan interest deduction. Currently, individuals earning an income of up to $80,000 per year (or $160,000 for married couples filing jointly) can deduct up to $2,500 per year in interest paid on their student loans, although the benefit begins to get phased out once an individual hits $65,000 per year in income. There are over 44 million student loan borrowers in the United States, and an estimated 12 million of them claim this deduction. Read More

4 Avoidable Student Loan Forgiveness Mistakes

| Articles Income-Based Repayment Income-Driven Repayment Loan Forgiveness Pay-As-You-Earn Student Loans 101

Student loan forgiveness is not a myth or a fairy tale. There are actual, legitimate programs that can provide partial or full forgiveness of your student loans – if the right conditions are met.

But it’s those conditions that often trip people up. A recent New York Times article provided real-world examples of student loan borrowers who thought they are on the path to loan forgiveness, only to find out later that they weren’t at all. I see this all the time in my practice, and it’s usually because people don’t fully understand the required criteria for student loan forgiveness programs (mostly due to the fact that these programs tend to be complicated, and student loan servicers do a pretty terrible job explaining them).

It’s important to take the time to understand these programs and determine whether or not you meet their requirements – because if you don’t, you may be in for some major disappointment later on. Here are the most common mistakes I see people make when it comes to student loan forgiveness. Read More

Two Major Student Loan Servicers to Merge

| Articles Current Events

BREAKING NEWS – Two of the largest student loan servicers in the country have just announced a merger. Nelnet will be purchasing Great Lakes Higher Education for $150 million.

Currently, the U.S. Dept. of Education contracts out servicing operations to four primary companies: Nelnet, Great Lakes, FedLoan Servicing (part of the Pennsylvania Higher Education Assistance Authority, or PHEAA) and Navient. These servicers also manage private loans on top of their federal student loan portfolios. Assuming the merger is approved, the combined Nelnet-Great Lakes entity would become the largest student loan servicer in the country.

What is fascinating about this – and, arguably, quite troubling – is that while student loan servicing remains atrocious, Great Lakes generally has the fewest customer complaints of the four major U.S. Dept. of Education servicing companies. Great Lakes is also the only nonprofit servicer of the four.  If this merger is approved, Great Lakes will effectively cease to exist, as it will become part of Nelnet. That will leave only three major servicing companies handling Direct federal student loans, two of which are currently subject to major lawsuits for systematic servicing problems (Navient and FedLoan Servicing/PHEAA). Read More