Time to Stop Taking the Earned Income Tax Credit to Pay for Defaulted Student Loans

FOR IMMEDIATE RELEASE: May 16, 2016

(BOSTON) Today, May 16, marks one month since tax day, and the National Consumer Law Center’s Student Loan Borrower Assistance Project has released a policy brief urging the White House, U.S. Treasury, and U.S. Department of Education to work together to stop taking the Earned Income Tax Credit (EITC) from struggling families to offset defaulted federal student loans.

The EITC is incredibly important to working families and is effective not only in alleviating existing poverty, but also in lifting future generations out of poverty. Seizing EITC payments is a counterproductive policy which compounds the harms borne by low-income borrowers, who in many cases were denied the promised benefits of education, and injures borrowers’ children in meaningful and potentially long-lasting ways. Payments made under a number of federal programs that are intended to benefit low-income individuals and families are already exempt from offset because offsetting these payments would frustrate the programs’ goals. It is time for the White House, the U.S. Department of Treasury, and the U.S. Department of Education to work together to end the harmful and counterproductive seizure of borrowers’ EITC payments.

Link to full blog post: http://www.studentloanborrowerassistance.org/stop-taking-eitc/

and policy brief: http://bit.ly/1R61mjq

National Consumer Law Center contacts: Jan Kruse ([email protected]) or Persis Yu ([email protected]); 617.542.8010

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Since 1969, the nonprofit National Consumer Law Center® (NCLC®) has worked for consumer justice and economic security for low-income and other disadvantaged people, including older adults, in the U.S. through its expertise in policy analysis and advocacy, publications, litigation, expert witness services, and training. www.nclc.org

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