HomePoliticsTrump Administration to Seize Wages and Tax Refunds from Student Loan Defaulters

Trump Administration to Seize Wages and Tax Refunds from Student Loan Defaulters

Sarah Johnson

Sarah Johnson

April 23, 2025

3 min read

Brief

The Trump administration plans to resume aggressive collections on defaulted federal student loans, including wage garnishment and withholding tax refunds, emphasizing taxpayer protection and fiscal responsibility.

Struggling to pay back your federal student loans? The Trump administration is making it clear: dodging your debt could soon mean saying goodbye to part of your paycheck, your pension, or even that long-awaited tax refund.

White House press secretary Karoline Leavitt announced that the government will actively pursue those who default on their federal student loans by garnishing wages, withholding federal pensions, and grabbing tax refunds. The administration insists this approach is about protecting taxpayers — not sticking them with someone else’s bill.

"The government can and will collect defaulted federal student loan debt by withholding money from borrowers, tax refunds, federal pensions and even their wages," Leavitt said Tuesday.

Collections on defaulted loans are set to resume in May, after a pause that began back in 2020. The Department of Education says the nation’s student loan tab is now nearly $1.6 trillion, and fewer than four out of ten borrowers are up to date on payments. That’s a mountain of debt — and apparently, the government doesn’t want to be left holding the bag.

Currently, four million borrowers are seriously behind on their payments, sliding into that tense 91- to 180-day delinquency window. If trends continue, the Education Department warns the number in default could hit nearly 10 million in just a few months. That’s enough people to fill New York City — twice.

Leavitt doubled down, saying, "This is unsustainable, unfair and a huge liability for American taxpayers. Debt cannot be wiped away. It just ends up getting transferred to others." She added, "So why should Americans who didn’t go to college, or went to college and responsibly paid back their loans, pay for the student loans of other Americans? The Trump administration will never force taxpayers to pay student loan debts that don’t belong to them."

The Biden administration’s attempts to forgive student loan debt have hit legal and political roadblocks. Secretary of Education Linda McMahon chimed in, criticizing those efforts: "The Biden Administration misled borrowers: the executive branch does not have the constitutional authority to wipe debt away, nor do the loan balances simply disappear. Hundreds of billions have already been transferred to taxpayers."

For the Trump team, the message is simple: If you borrow, you pay. Leavitt summed it up: "We must get our fiscal house in order and restore common sense to our country. If you take out a loan, you have to pay it back. It’s very simple. President Trump will not kick the can down the road anymore."

Topics

Trump administrationfederal student loansloan defaultwage garnishmenttax refund withholdingstudent debt collectionDepartment of Educationstudent loan crisistaxpayer protectionPoliticsUS NewsEducationStudent Loans

Editor's Comments

Honestly, if the government starts collecting student loan debt like this, we might see more people hiding from their mailman than from their exes. The real plot twist is watching Washington act shocked that $1.6 trillion doesn’t just disappear with a magic wand. Someone should set up a GoFundMe for stressed-out tax refunds.

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