Americans with disabilities can get their student loan debt erased tax free under this program!

Total and Permanent Disability (TPD) Discharge is a program created by the U.S. Department of Education. It relieves a borrower who is totally and permanently disabled from having to repay federal student loans or TEACH Grant service obligations.

Before federal student loans or TEACH Grant service obligations can be discharged (or erased), a person must submit an application for discharge and provide information to show they are totally and permanently disabled.

There are three ways you can show you meet the TPD discharge requirements:

If you’re a veteran, you can apply for TPD discharge and provide documentation from the VA showing you have a service-connected disability (or disabilities) and are unable to work.
If you receive Social Security Disability Insurance (SSDI) or Supplemental Security Income (SSI), and your next disability review will be within five to seven years of your most recent one. You can submit paperwork showing your SSA notice of award for SSDI, SSI disability benefits, or a Benefits Planning Query that states the date of your next review.
If you submit acceptable certification from a doctor (an M.D. or D.O.) declaring you are totally and permanently disabled. The physician must certify you’re unable to work due to a physical or mental impairment that: can be expected to result in death, has lasted for a continuous period of not less than 60 months, or can be expected to last for a continuous period of not less than 60 months.

If you are unable to complete the application on your own, you can authorize a representative can complete and submit your TPD discharge application on your behalf. With this option, you can designate an authorized representative with a TPD Applicant Representative Designation form. This has to be submitted and processed before they’re able to work with your representative. Your representative can be a friend, family member, advocate or someone else you trust.

Get the TPD Application Form and Representative Designation form at

www.disabilitydischarge.com/Forms

After the US Department of Education receives your TPD discharge application, they will contact the holders of your federal loans or TEACH Grant service obligation and suspend collection on your loans while they determine eligibility. This means you won’t have to make any payments on your loans while they look over your application, which can last up to 120 days. *Note: If your loans are in default and payments are collected through wage garnishments, this will continue until your discharge is approved.

If you are approved for the TPD Discharge program, you will be notified in writing by the US Department of Education or its contractor (currently Nel Net). Your loans or TEACH Grant will be transferred to the U.S. Department of Education for discharge (meaning they will be erased as long as you complete the monitoring period). The lenders will also be asked to return any payments you made after the date the

Department received your application. If you are approved for TPD because you are a veteran with a disability, there is no monitoring period.

Your student loans will be forgiven and erased as soon as you are approved for the TPD program.

If you are approved for a TPD discharge based on SSA disability documentation or a physician’s certification, you will be subject to a 3-year post-discharge monitoring period that begins on the date the discharge is approved.

If at any time during the 3-year monitoring period any of the following occurs, your loans will be reinstated and you will be obligated to repay your discharged loans.

You have annual employment earnings that exceed the poverty guideline amount for a family of two (typically somewhere around $16,000, check the TPD website to find out the latest dollar amount); or
You apply for and receive a new Direct Loan, Perkins Loan, or TEACH Grant; or
A disbursement of a Direct Loan, Perkins Loan, or TEACH Grant that you received before the discharge date is made, and you do not ensure the return of the full amount of the disbursement within 120 days of the disbursement date; or
You receive a notice from the SSA stating that you are no longer totally and permanently disabled, or that your disability review will no longer be the 5-year or 7-year review period indicated in your most recent SSA notice of award for SSDI or SSI benefits; or
If the Department receives notice from SSA that you are no longer in a MINE (Medical Improvement Not Expected) with a review cycle of 5 to 7 years.

Do I have to pay taxes on my student loan debt which is discharged (erased) under this TPD program?

Thankfully, no. Not currently. Thanks to a new law passed by Congress, all people with disabilities approved for this TPD program after Jan. 1, 2018, will NOT owe taxes on any student loan amounts discharged/erased under this program. This law expires in 2025, but it is eligible for renewal by Congress at that time.

What if my TPD Application is denied?

If your TPD application is denied, you will be notified of the denial by mail. They will also instruct your loan holders to resume collection activity on your loans. The letter you receive will include the reason for the denial and instructions on what you can do if you have questions about the basis of the decision or believe there is other information that the Department should consider. You will also have an opportunity to provide additional information and to appeal the denial.

For more information and to apply for the TPD program visit: https://www.disabilitydischarge.com