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Old Student Debt Can Haunt Social Security Benefits, but New Bill Offers Help

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Top Senate Democrats introduced legislation on Thursday to protect Americans who receive Social Security from having their benefits garnished to pay outstanding federal debts, such as student loans.

The bill, the Protection of Social Security Benefits Restoration Act, was introduced by Senate Finance Committee Ranking Member Ron Wyden, D-Ore., and Sen. Sherrod Brown, D-Ohio, ranking member of the Finance Committee Social Security, Pensions, and Family Policy Subcommittee, as well as eleven Senate Democrats.

“Americans shouldn’t see their Social Security checks ripped away because of the increasing burden of student loan debt,” Wyden said in a statement announcing the bill. “People who have worked hard and paid into the program count on these benefits just to survive – there ought to be basic protections to defend struggling Americans from having their earned Social Security benefits cut by the federal government.”

The bill would repeal a decades-old change in law (made in 1996) that allowed earned benefits to be garnished by the federal government to collect federal debts, like student loans, home loans owed to the Veterans Administration and food stamp overpayments, the Senators explained.

The number of Americans who have had their benefits garnished by the federal government has dramatically increased in recent years – from 36,000 in 2002 to 173,000 in 2015 – nearly a fivefold increase, they said.

That includes certain people under 65 who receive Social Security Disability Insurance.

“Americans work hard to earn their Social Security and we cannot allow it to be stolen away by student debt,” added Brown. “Instead of going after seniors and the disabled, the government should be working to address the skyrocketing cost of student debt.”

The legislation also reestablishes protections in Social Security and other benefit programs, such as Railroad Retirement and Black Lung Benefits that mainly effect coal miners.


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