HELP! Ed's Offset of federal vendor income taking entire income

[dupont]

Hello all. What a great site this is. I can't believe all the useful advice. I wish I had discovered this earlier. The Dept of Education has initiated a set aside/off set (in effect, a garnishment) of any government checks I receive. The computer shows the checks as Refunds but they are actually my income. I do court appointed legal work for a federal court and the federal government pays it. DOE is essentially taking my entire income. They are taking essentially 99%. Once I saw that was happening I immediately stopped submitting vouchers for payment. I am getting close to dire circumstances.

 

I was told by DOE to write to the DOE FMS Offset Review Unit in Chicago (no phone number I was told) and request a hardship review. I was advised to include 1) letter explaining the nature of the hardship 2) my last filed tax return 3) my 1099 for last year 4) completed financial statement and 5) any documentation of the offsets I am being subjected to. For each offset - 3 checks so far - I am sent a notification of the off set by a section of the Treasury Dept that handles such things.

 

They claim I will receive a reply within 15 calendar days.

 

I was away for a period of time and my building or postman not very carefully bundled my mail and stored it until my return. Any letter regarding the intent to offset was lost or I just totally failed to see it. I wonder if I just failed to read the entire printing in one of their communications. In any case, had I seen it I would have called DOE immediately since I know my entire income consists of federal payments. I am officially considered a vendor and my checks come from GSA.

 

My loan is in rehab now with GC Services (they have been fine working with me so far) - I had to cancel one of my predated checks cause I couldn't come up with the money for deposit to cover the check. I was told I am allowed one cancellation. I have made 3 payments in rehab to date. GC Services has offered to help me with DOE and I plan to send them a copy of my "hardship package." As soon as I can get the offset lifted or at least reduced to the max 15% I believe they are allowed to take, I should be okay until the rehab period is completed. I believe that the offset can be lifted once my loan is out of rehab.

 

If anyone has any advice it would be greatly appreciated. I am trying to stay calm and just keep pluggin away because I have to keep my practice going and handle my work load and that requires money (I represent poor clients in court) since I am self employed.

 

My question is does anyone have experience with this? Experience with the DOE FMS Offset Review Unit in Chicago? Experience writing these hardship letters? Potential for success? What I have read about the 15% max is that it applies to the net/take home income and I am deeply concerned that they will not consider my payments as "income" since I am self employed. The checks come sporadically - sometimes weekly depending when I submit my vouchers for payment and when they are approved by the court for payment - I have to wait until a case is completed before I can submit a voucher - this can take years for some cases.

 

I hope I haven't made my situation more complicated than it is or difficult to understand. I have no idea what I will do if I am denied a hardship ruling since this is my sole source of income and after working for indigent clients for so long you end close to their financial bracket.

 

Thanks so much. Again, great forum.

[LynnInMN]

I was away for a period of time and my building or postman not very carefully bundled my mail and stored it until my return. Any letter regarding the intent to offset was lost or I just totally failed to see it.

 

They do send a notice but your government reimbursement does not fall under the normal admmin garnishment rules . I remember working with someone who had their miscelaneous expense checks seized...reimbursement for milage, meals etc. Never heard of having all of pay seized. However, it could be legal. There are cases where physicians are barred from submitting medicare claims due to defaults.

 

I wonder if I just failed to read the entire printing in one of their communications. In any case, had I seen it I would have called DOE immediately since I know my entire income consists of federal payments. I am officially considered a vendor and my checks come from GSA.

 

My loan is in rehab now with GC Services (they have been fine working with me so far) - I had to cancel one of my predated checks cause I couldn't come up with the money for deposit to cover the check. I was told I am allowed one cancellation.

WRONG.....you are not permitted to miss ANY payments in the rehab program.

 

I have made 3 payments in rehab to date. GC Services has offered to help me with DOE and I plan to send them a copy of my "hardship package." As soon as I can get the offset lifted or at least reduced to the max 15% I believe they are allowed to take, I should be okay until the rehab period is completed. I believe that the offset can be lifted once my loan is out of rehab.

 

 

 

Thanks so much. Again, great forum.

Edited May 4, 2006 by LynnInMN

[busymom4]

I too work for the goverment and one of the contracts I signed stated that I had no defaulted loans-this was a condition of my employment. The gov. is not suppose to hire or contract with anyone that is in default or has been convicted of any federal fraud.

I'am sorry that I can't be of much assistance, hopefully someone else will be able to help more though.

You stated the CA has offered to help, I would take them up on that and you may want to contact the ombusman and see if they can assist you. You could also contact your human resourse office or whoever processes your checks and see what they can do.

[dupont]

Thanks for all your input. I'm looking into the issues you raised. I work under a specific statute and I need to reread it. There's no contract involved.

 

I understand that to get out of rehab I have to have 12 consecutive timely payments. So I assumed that I was just starting over with payment one. I think what my rehab agency was saying was that they would let me continue in the rehab program which is what's happening. But thanks for that heads up.

 

I hope I can refer others to this board who might need some advice from those with similar experience. Thanks again.

Edited May 7, 2006 by dupont