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Trump wants to erase student loan debt for disabled veterans

President Donald Trump at Yokota Air Base in Japan (Official White House Photo by Shealah Craighead)
April 25, 2018

The Department of Education recently announced that permanently disabled U.S. veterans may be able to have all of their student loans discharged and erased, CNBC reported.

The vets who qualify would be identified through combined efforts of the Department of Education and the Department of Veteran Affairs (VA), and then notified by mail.

The package veterans would then submit for review would include a Total and Permanent Disability Discharge application that must be filled out and sent back to determine eligibility.

If approved, some veterans with permanently severe physical impairments could have all of their student loans discharged and erased.

In 2016, efforts were initiated by the Obama Administration to discharge severely disabled veterans’ student loans, but they were set aside due to complicating tax laws that would have required those with erased student loan debt to have to pay tax on it. The cancelled debt was considered to be taxable income.

At that time, joint efforts between the Education Department the Social Security Administration identified 387,000 permanently disabled vets with student loans, of which 179,000 were in default on their loans and at risk of having their Social Security benefits garnished, the Washington Post reported.

Under the Trump Administration, the new tax code waives federal income taxes on forgiven education debt for permanently disabled people.

Carrie Wofford, president of the nonprofit Veterans Education Success, said that many disabled veterans have no idea that they can qualify for student loan debt forgiveness, so such outreach is needed.

“It’s horrific. There are disabled veterans who served their country who are financially struggling — and sometimes destitute — who are legally entitled to have their student loans forgiven, but it’s not happening,” Wofford said.

“Our nation’s veterans have sacrificed much for our country. It is important that, in return, we do all we can to give them the support and care they deserve. Simplifying the loan forgiveness process and proactively identifying veterans … is a small but critical way we can show our gratitude,” Education Secretary Betsy DeVos said in a statement Monday, the Washington Post reported.


Mark Kantrowitz, a student loan expert said: “The government shouldn’t be preying on the misery of borrowers. Making this debt dischargeable without taxes is a much, much better process.”