Can the IRS Seize Our Bank Account for a Defaulted Student Loan? – Judy

“Dear Steve,

IRS has garnished our income tax refund from 2012, for a student loan defaulted in 1990 or 1991. This is my student loan, for about $2200 at the time. I’m sure it is more now, 23 years later. I am not employed. My husband’s income is our only source of income and we filed our taxes Married filing Jointly, as we always have. We married in 2000, several years after I originally defaulted on this loan.

We found out they garnished our refund when checking at for the information on our refund, at the “Where’s my refund?” page. We have not received the letter in the mail from the IRS informing us about this yet.

Can the IRS seize our joint bank account for this loan? Can they garnish my husband’s wages? If they seize an account, will they give notice, and will taking my name off the account prevent seizure?

Thank you.



Dear Judy,

While the IRS was the vehicle which intercepted your refund, they are not the reason it was intercepted. The IRS cannot levy a bank account for a student loan default. The IRS was asked to intercept the refund on behalf of the Department of Education.

It seems clear your student loan was a government backed loan. So the good news is you can rehabilitate the loan to stop this from happening in the future.

See The Ultimate Guide to Dealing With Student Loans You Can’t Afford.

If you don’t get a repayment plan in place the student loan agency could administratively garnish his wages. Nothing good is going to happen here by waiting.

Follow the guide and get on a repayment plan that you can afford. payment plans are available for as little as $0 per month.

Please post your responses and follow-up messages to me on this in the comments section below.


You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.
Damon Day - Pro Debt Coach

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