How Can I Still Get My Refund With a Defaulted Student Loan?

The federal student loan program was devised to ensure every person who qualified to attend a higher education institution could do so through borrowing money to pay tuition, regardless of income or creditworthiness. It is common for students to borrow more than once, creating a conundrum as those multiple loans come due after graduation. If a borrower defaults on a student loan, the federal government reserves the right to withhold an income tax refund to satisfy the debt.

Step 1

Gather your student loan collection letters. Calculate the total owed.

Step 2

Write a budget. Use a budget writing software program or budget template to arrive at a budget that will allow you to make monthly payments to payoff your defaulted student loan.

Step 3

Phone the US Treasury's Financial Management Services at 800-304-3107. Request to get on a payment plan. Inquire if the payments are made on time, your tax refund will not be withheld or "offset." Ask for a written agreement to be mailed to you stating the same.


If you are married, the U.S. Treasury's Financial Management Services suggests you complete IRS Form 8379 to receive your spouse's portion of the tax refund (See Resources).

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