Democrats Introduce Bill to Protect Social Security Benefits From Student Loan Garnishment

Democrats in both houses of Congress introduced a bill last Thursday that would protect Social Security benefits from being garnished from those struggling to repay federal student loans, which are scheduled to resume in October.

The bill is called the Protection of Social Security Benefits Restoration Act and is sponsored by eight senators and seven representatives, all Democrats except Senator Bernie Sanders, I-Vermont. Motivated primarily by student loan debt payments restarting after a COVID-19 pandemic hiatus, the bill, if passed, would prevent the federal government from seizing Social Security benefits to pay any non-tax debt owed to the federal government.

Railroad and black lung benefits would also be insulated from garnishment for non-tax federal debt.

The sponsors of the bill cite a 2016 report from the Government Accountability Office which identified 3.5 million Americans age 60 and older holding student debt adding up to approximately $125 billion.

According to the same report, from 2001 to 2015, 186,000 Americans younger than 50 and 2,524 Americans older than 65 had Social Security disability benefits garnished to pay back student loans, and 64,197 Americans over the age of 65 had their retirement or survivor benefits garnished. Anybody receiving Social Security benefits could be subject to garnishment if they have outstanding federal debt payments.

The bill has been referred to the Senate Committee on Finance, the House Committee on the Judiciary and the House Committee on Ways and Means due to overlapping areas of jurisdiction.

Unless it is attached to a budget bill by the end of September, it will be unlikely to pass before the Department of Education resumes debt collection in October, with exact dates varying based on each account’s existing schedule. Even if the bill is attached, it is far from certain the federal budget will be passed in time.