This week, the U.S. Department of Education announced a new process to identify and assist federal student loan borrowers with disabilities who may be eligible for a Total and Permanent Disability (TPD) loan discharge. A Federal law, The Higher Education Act, allows borrowers who are totally and permanently disabled to discharge their student loans.

Under the new process, the U.S. Department of Education will notify potentially eligible borrowers about the benefit and guide them through steps needed to discharge their loans. Beginning on April 18, 2016, disabled borrowers who have been identified by the U.S. Department of Education will receive a letter explaining that the borrower is eligible for loan forgiveness and the steps needed to receive a discharge. These steps include signing and returning a completed application.

Borrowers need to understand the potential tax implications for this benefit so they can make an informed decision about electing a discharge.  Please refer here for more information about the Total and Permanent Disability Discharge for Federal Student Loan Borrowers.

Disabled student loan borrowers are encouraged to visit the U.S. Department of Education’s Total and Permanent Disability (TPD) Discharge website for even more information.