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What You Need to Do to Get Your Federal Student Loans Forgiven if You Are Disabled

Written by Steve Rhode

Question:

Dear Steve,

I’m medically disabled and unable to work. Sever strokes, diabetes, heart stents, high blood pressure, amputee, difficulty walking some dementia, due to the stroke, and kidney disease.

How yo apply for total and permanent discharge?

Alvin

Answer:

Dear Alvin,

My goodness, you’ve faced your medical challenges. I can’t even begin to imagine the obstacles you face every day in dealing with all of this.

But the good news is you are probably eligible to have your federal student loans forgiven.

The bad news is it’s a process. But let me see if I can simplify this as much as possible for you to make the process easier.

Website

The official website for the Total and Permanent Disability (TPD) Discharge is at DisabilityDischarge.com. You would think it would be a .gov website but for some reason, it is not.

Taxes

Previously the forgiven debt from TPD was taxable, as insane as that is. But here is the current status on tax liability for the forgiven debt.

  • If you received a TPD discharge of a loan before Jan. 1, 2018, the loan amount discharged may be considered income for federal tax purposes under Internal Revenue Service (IRS) rules.
  • If you received a TPD discharge of a loan during the period from Jan. 1, 2018 to Dec. 31, 2025, the discharged loan amount won’t be considered income for federal tax purposes.

How to Qualify for a TPD

You can show that you qualify for a TPD discharge by providing documentation from one of three sources:

1. the U.S. Department of Veterans Affairs (VA)
2. the Social Security Administration (SSA)
3. a physician

VA Documentation

If you’re a veteran, you can qualify for a TPD discharge by providing documentation from the VA that shows you have received a VA disability determination because you (1) have a service-connected disability that is 100 percent disabling; or (2) are totally disabled based on an individual unemployability rating.

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SSA Documentation

If you’re eligible for Social Security Disability Insurance or Supplemental Security Income, you can qualify for a TPD discharge if you provide a copy of your SSA notice of award or Benefits Planning Query showing that your next scheduled disability review will be five to seven years or more from the date of your last SSA disability determination.

Physician’s Certification

You also can qualify for a TPD discharge by having a physician certify on the TPD discharge application that you are unable to engage in a level of work performed for pay or profit that involves doing significant physical or mental activities, or a combination of both. due to a physical or mental impairment that

  • can be expected to result in death;
  • has lasted for a continuous period of at least 60 months; or
  • can be expected to last for a continuous period of at least 60 months.

The physician who certifies your TPD discharge application must be a doctor of medicine (M.D.) or doctor of osteopathy/osteopathic medicine (D.O.) who is licensed to practice in the United States.

Applying for a TPD Discharge

This might be the toughest part for people since it could be easy to struggle in dealing with the forms and information requested. However, the good news is the process does allow for you to have a representative apply for you. But keep in mind, if you have to gather the data needed for a representative, you’ve already done the work of getting the information together.

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Local community service or legal aid organizations that provide holistic and compassionate care seem like likely candidates that maybe already recognized representatives.

The Application Process

This is the complicated part since it is where all the details are needed. The webpage you need to visit is right here. The online application tool will ask you questions and allow you to print out a partially completed PDF form to print and finish.

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Or you can just download and print a blank PDF form to complete as you get the information together.

Honestly, I think printing the blank form is the easier way to go.

Once all the information is gathered and you have fully completed the application, I would suggest you make copies of all the information before sending it in. I also recommend sending it by some traceable means that gives you a notice it was received.

You can also fax or upload your application as well. The place to look for all the addresses or fax numbers is here.




About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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