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Can they garnish my wages or take my refund or Social Security? Yes, the law allows it, but not right now: once a federal student loan is in default (generally 270 days without a scheduled payment), the government can garnish up to 15% of your disposable pay without a court order and take your tax refund and part of your Social Security. The Education Department paused both on Jan. 16, 2026 and has not announced a restart date as of Oct. 21, 2026. The ways out are rehabilitation, consolidation or paying in full.
Updated Oct. 21, 2026. Sources below.
(StudentAid.gov: Collections on Defaulted Loans · StudentAid.gov: Defaulted Loans Support Center · StudentAid.gov: Delinquency and Default)
For Direct Loans and FFEL Program loans, you are in default when you have not made your scheduled payments for at least 270 days. A Perkins Loan holder may declare default after one missed due date. (StudentAid.gov: Delinquency and Default)
In default, the whole unpaid balance and interest become due at once (“acceleration”), you lose deferment, forbearance and the choice of repayment plan, you can't get more federal student aid, and the default is reported to credit bureaus. (StudentAid.gov: Delinquency and Default)
Defaulted loans held by the Education Department are serviced by the Default Resolution Group once they are more than 360 days delinquent. (StudentAid.gov: Delinquency and Default)
The government can order your employer to withhold up to 15% of your disposable pay without suing you. Before it starts you must be mailed a notice at least 30 days ahead, and you get the right to see and copy the records, to set up a written repayment agreement, and to a hearing. (31 U.S.C. 3720D · 34 CFR Part 34 (eCFR) · StudentAid.gov: Collections on Defaulted Loans)
At a hearing you can object that the debt doesn't exist, the amount is wrong or it can't be enforced, that 15% would cause extreme financial hardship, or that you have been back at work for less than 12 months after an involuntary job loss. A written hearing request postmarked within 30 days of the notice keeps garnishment from starting until a decision. (34 CFR Part 34 (eCFR) · StudentAid.gov: Collections on Defaulted Loans)
“Disposable pay” is what's left after health insurance premiums and amounts required by law to be withheld, such as Social Security and income tax withholding. The employer withholds the smaller of the order amount or the amount by which weekly disposable pay exceeds 30 times the federal minimum wage (30 × $7.25 = $217.50). (34 CFR Part 34 (eCFR))
| Weekly disposable pay | 15% | Pay above $217.50 | Withheld (smaller) |
|---|---|---|---|
| $1,000 | $150.00 | $782.50 | $150.00 |
| $500 | $75.00 | $282.50 | $75.00 |
| $250 | $37.50 | $32.50 | $32.50 |
| $200 | $30.00 | $0 | $0 |
Example: $1,000 a week × 15% = $150 a week, about $650 a month. Federal-wide garnishment limits for other debts: wage garnishment calculator.
Through the Treasury Offset Program, your federal tax refund can be taken in full, and other federal payments can be reduced to pay a defaulted student loan. State tax refunds may also be withheld. Before an offset starts, a notice of intent is mailed giving you 65 days to set up a payment arrangement, start rehabilitation, apply to consolidate, pay in full or object in writing. (31 U.S.C. 3716 · Fiscal Service: TOP rules fact sheet · StudentAid.gov: Collections on Defaulted Loans)
Social Security: the monthly offset is the least of the debt, 15% of the monthly benefit, or the amount by which the benefit exceeds $750. So the first $750 a month is protected. Supplemental Security Income (SSI) is not offset. (31 CFR 285.4 (eCFR) · Fiscal Service: TOP legal authorities · SSA POMS GN 02410.300 (Benefit Payment Offset))
| Monthly benefit | 15% | Amount over $750 | Offset (least) |
|---|---|---|---|
| $1,250 | $187.50 | $500.00 | $187.50 |
| $850 | $127.50 | $100.00 | $100.00 |
| $650 | $97.50 | $0 | $0 |
These three examples are the ones in 31 CFR 285.4(e)(3). (31 CFR 285.4 (eCFR))
The Default Resolution Group helps for free. StudentAid.gov warns: if a company asks for “enrollment,” “subscription” or “maintenance” fees to get you out of default, walk away. (StudentAid.gov: Getting Out of Default · StudentAid.gov: Collections on Defaulted Loans)
Facts, not legal or financial advice. This page republishes federal law and StudentAid.gov with dates. It covers federal student loans only, not private loans. Your loan holder and StudentAid.gov have the final word on your loans.
Yes. Under 31 U.S.C. 3720D and 34 CFR Part 34, the Education Department can order your employer to withhold up to 15% of your disposable pay without a court order, after mailing a notice at least 30 days before garnishment starts. You can ask for a hearing. Administrative Wage Garnishment has been paused since Jan. 16, 2026, with no restart date announced as of Oct. 21, 2026.
Yes. Through the Treasury Offset Program (31 U.S.C. 3716; 31 CFR 285.4), federal tax refunds and other federal payments can be withheld. Social Security offset is the least of the debt, 15% of the monthly benefit, or the amount above $750, so the first $750 a month is protected. SSI is not offset. Treasury offset for student loans has been paused since Jan. 16, 2026.
For Direct Loans and FFEL Program loans, when you have not made scheduled payments for at least 270 days. A Perkins Loan holder may declare default after a single missed due date (StudentAid.gov).
StudentAid.gov lists three ways: loan rehabilitation (nine voluntary, reasonable and affordable monthly payments within 20 days of the due date, over 9 or 10 consecutive months), consolidation into a Direct Consolidation Loan, or repaying the loan in full. Beginning July 1, 2027, a loan can be rehabilitated twice instead of once.
Not as of Oct. 21, 2026. The Education Department delayed Administrative Wage Garnishment and Treasury Offset on Jan. 16, 2026 and StudentAid.gov says both are currently paused. News reports on Oct. 19 and 20, 2026, citing unnamed sources, said Treasury could hire private collectors as soon as November with collections in 2027. Nothing has been officially announced.
Facts, not legal or financial advice. Collection status changes; confirm with your loan holder and StudentAid.gov.