Once a borrower has been granted a discharge based on total and permanent disability, the Department will begin requesting documentation of employment earnings in order to verify that the borrower did not have annual earnings from employment over the Poverty Guidelines (for a family of two in the borrower's state of residence, regardless of actual family size) for up to three (3) full years following the date the discharge was granted by the Department.
What Are Considered Employment Earnings?
Employment earnings are defined as any income the borrower receives from employment. The Department does not include income that was not earned for work performed, such as income received from disability compensation or wages paid by an employer while the borrower is on sick leave.
Method of Review
The Department will require you to submit documentation of your employment earnings, generally on an annual basis. To do so, you may submit any of the following as documented proof of income:
- Filed income tax return, with all attachments
- Pay stubs showing year-to-date income
- Social Security Statement. (Visit www.ssa.gov/mystatement. You must set up an account to see, download, save and print your full statement of earnings.)
NOTE: If you did not earn income from employment, send us a letter signed by you or your representative specifying the tax year(s) for which no income was earned.
Statements of Earnings and IRS documentation do not always exclude or separately identify income that is not earned from work performed. Therefore, if the borrower received income that was not earned for work performed, such as disability pay or wages paid for sick leave, the borrower should provide the Department with documentation of the disability compensation or sick leave pay, so that the Department can exclude these amounts from what is reported in the borrower’s Statement of Earnings, or IRS documentation.
The following table describes the letters that are sent to verify employment earnings:
|Request for Employment Earnings
||The borrower will receive this letter on the anniversary of the date the discharge was granted by the Department. The borrower must respond to this letter with the requested information within 60 days of the letter being sent.
|2nd Request for Employment Earnings
||The borrower will receive this letter if he or she does not respond to the Request for Employment Earnings letter within 60 days of the letter being sent.
|Final Request for Employment Earnings
||The borrower will receive this letter if he or she does not respond to the 2nd Request for Employment Earnings letter within 60 days of the letter being sent. If the requested information is not received within 30 days of the Final Request for Employment Earnings letter, the borrower will be determined to be ineligible for discharge and the loan(s) and/or TEACH Grant obligation will be reinstated (returned to an active repayment status).
|Notice of Incomplete or Missing Information
||If a borrower responds to one of the above-mentioned letters but does not provide sufficient documentation of employment earnings, the Department will send a letter notifying the borrower of any additional documentation that may be needed.