aug 2018 info student loan discharge for 100% SC or TDIU

[GeekySquid]

Hi all,

As some may have read elsewhere I just got a 100% SC for PTSD rating from my 8/16/2018 C&P review. At this minute I am waiting for my Big Brown Envelope and battling Ebenefits web site in hope to see my AB8 letter updated. Its the weekend and their outage calendar says they will be down all the way through Tuesday. On monday I go to the American Legion and hopefully my new AB8 will be visible in the VBMS

On to student loans. I have them and so do many veterans who are disabled. There seem to be some oddities and word games in the way Nelnet phrases things and I think vets should be aware of this and we can maybe track outcomes of people on here who do apply. more down below.

Until recently getting your student loans discharged was a) a pain in the neck and b) would likely result in an IRS tax hit which considered the forgiven amount to be income. Sucks to discharge 100K and get a 50K tax penalty but that is what the old law laid out

B is no longer a problem, veterans who get their student loans discharged will no longer be hit with that penalty. This is effective with the 2018 tax law.

A is yet to be seen. The new process, handled by Nelnet for the Dept of Ed, gets to interface with the VA and if a vet is 100% SC or TDIU they can discharge their loans. Under the outlined process on their website https://www.disabilitydischarge.com/     The VA sends Nelnet notification that a vet is TDIU or 100% and they send you a letter and  a form saying you are eligible and what you have to do. Vets don't have to supply any more info, according to the site, because the VA has provided it.

You can also initiate the process yourself if you did not get a letter or you have just been rated, etc. A blank form is attached here but there is an online form generator on the site that will partially fill in the blanks for you and then you download and sign. You will have to supply your AB8 and possibly other documentation depending on which sections of the form you fill out. .

The wording oddities:

On the site where they describe who is eligible and in the monitoring section there are oddities.

The good news is that they have clarified that if a Veteran is TDIU they are not subject to monitoring the way people apply based on SSI or other programs are. The VA says if you are on TDIU you can only earn poverty level income but there is no clearly designated way they would know if you are working and I am guessing the VA does not have the staff to monitor everyones tax returns.

With the Student loan discharge, Nelnet is allowed to monitor you electronically and physically to see if you are working and then find out if you are making more than poverty wages. I will say again according to the site VETS who are TDIU are not subject to monitoring. However it is not clear that if you don't have the specific TDIU designation but are 100% SC that you will not be monitored. More research is needed.

This is part of the wording oddities.

On the site and in the FAQ they say:

" – If you are a veteran and we have received information from the U.S. Department of Veterans Affairs (VA) indicating that you have a service-connected disability (or disabilities) that is 100% disabling or that you are totally disabled based on an individual unemployability rating we will contact you and explain how you may apply for a TPD discharge, but you will not need to provide documentation of your VA determination. "

That word, or, indicates that a TDIU designation is not needed. meaning if you are 100% scheduler you should qualify.

but in section 5 of the attached blank application it says:

2) you are a veteran who has been determined by the VA to be unemployable due to a service-connected disability. Except for certain individuals who have received SSA notices of award for SSDI or SSI benefits, or for certain veterans, a disability determination by another federal or state agency does not establish your eligibility for a discharge of your loan(s) and/or TEACH Grant service obligation due to a total and permanent disability.

That phrasing might be important as it explicitly uses the word unemployable which connotes TDIU. Not all 100% scheduler vets will have any statement in their file that says they are unemployable. and even the FAQ might be read to that both halves of the "or" statement actually mean the same thing. Legalese is somethings that F'd up. 

If anyone has started the process in 2018 it would be great to hear what your experience is with them and the process.

 

blank student load discharge application based on va.pdf

[broncovet]

I got my loans discharged several years ago.  My advice, frankly, is to "chill out".  First, you need to wait for the decision, and to print out the AB8 letters.  

Its okay if you go to your VSO on monday and check the status, if it makes you feel better, but it wont likely hurry anything up.  

You can get student loan forgiveness for EITHER 100 percent or TDIU.  You dont have to prove you are not working when you get 100 percent.  The late John McCain is an example of a Vet who gets 100 percent and works.  Tammy Duckworth is also a disabled Vet who gets 100 percent and works.  TDIU is another thing, however.  

Just like the rest of us, you are simply gonna have to wait for the official notice before applying for student loan forgiveness.  

My advice is to do something else.  Go fishing.  Play chess.  Deepen your relationship by spending time with your wife.  Take her to the park, and hold her hand.  Go to church.  Anything (positive).  

Dont just sit around waiting for the mailman.  You wont be able to get those days (weeks, months or years) back.    Use your "waiting" time productively, and not watching the clock.  

   Here is something that could be fun:  Calculate your retro, and make decsions on how to spend it.  (or save/invest it, even better).  

Edited August 26, 2018 by broncovet

[Buck52]

I agree with broncovet

but we do all agree the Anticipation  (waiting) is  very stressful.