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Update: 9/29/21 - Department of Education Expands Pause to Defaulted FFEL Student Loans
The Department of Education Expanded the pause on student loan payments and interest to Defaulted Federal Family Education Loans (FFEL).
What you need to know about the pause on these student loans:
- You don’t have to pay on your defaulted loans until January 31, 2022, if your loan was part of the FFEL program. If defaulted, your interest will also be at 0%. These changes will be backdated to March 13, 2020.
- If you defaulted on your student loans March 13, 2020 or later, your tax refund won’t be taken to repay the defaulted loans, and you will be returned to good standing with your servicer. Any default showing on your credit report for this time period should be removed from your record.
- If your tax refunds were already taken or your wages were garnished for this period, the Department of Education will work to automatically return this money to you.
- If you made voluntary payments on any of your defaulted Federal Family Education Loans after March 13, 2020, you will have the option to request a refund for those payments.
- Read more about the extension on defaulted FFEL loans
Update: 9/29/21 - Let’s Get Clear about COVID Student Loan Debt Relief
Federal Student Loan Payment Suspension and Interest Set to 0% through January 31, 2022.
- The CARES Act passed on March 30th has put an automatic suspension on all federally backed student loans and set the interest rate to 0% from March 13, 2020 to January 31, 2022.
- The payment suspension was extended to January 31, 2022.
- This means that people with those loans do not have to make payments and no interest will be accruing on the loan during that time.
- This does not apply to all student loans. Some FFEL loans are backed by private lenders and some Perkins Loans are owned by the college attended and may not be included in these protections. If you are unsure if your Perkins or FFEL Program Loans qualify, go to your student loan account online to check.
- Read more here.
Suspended Payments Count Toward Public Service Loan Forgiveness and Income-Driven Repayment Plan Forgiveness
- Through January 31, 2022, payments suspended due to the CARES Act and the executive order that followed will count towards any student loan forgiveness program, as long as all other requirements of the loan forgiveness program are met.
Assistance for Some FFEL & Perkins Loans and Other Private Student Loans
If your FFEL Program Loans are not eligible for these concessions, we recommend you:
- Ask your servicer if a forbearance is an option. Your interest will still accrue, but this is an easy option to sign up for by talking with your servicer and will give you time to get in a more stable financial position.
- Ask for an unemployment deferment if your work hours have been cut to below 30 hours a week or you’ve lost your job due to COVID-19. For some loans, interest will not accrue in that program.
For other private loans, we suggest you follow up with the servicer to see what options they are giving for the COVID-19 pandemic. Several private student loan servicers are offering options. Read more here.
Relief for Student Loans in Default
- The Department of Education has stopped the collection of defaulted federal student loans, including garnishment of wages and the offset of tax refunds and Social Security benefits.
- The CARES Act also suspends interest for federally owned loans that are in default, through January 31, 2022.
- There is no additional action required from you, if collection activities on your federally owned loans have already been suspended. If collection activities on your defaulted federal loans continue, contact your loan holder to find out about your options.
- If you are rehabilitating a defaulted student loan, any missed payments due to the coronavirus pandemic will not be considered a missed payment against your rehabilitation.
- Visit the Department of Education’s website to learn more about rehabilitating a defaulted federal student loan.
If you have additional questions about your student loans being impacted by COVID-19, visit this FAQ page from the Consumer Financial Protection Bureau (CFPB).
Update: 8/12/21 - Federal Student Loans + Asheville/Buncombe Property Taxes
The U.S. Department of Education extends the student loan pause one final time.
What you need to know about your federal student loan:
- If you have federal student loans, you will have 0% interest, $0 payment, and no collections on defaulted student loans through January 31, 2022.
- This will be the final extension of the pause on interest and payments. Your student loan payments and the interest on your loan will resume in February 2022.
- Once the pause on student loans ends, you will receive your billing statement or a notice about payments resuming at least 21 days before payment is due.
- Read more about the pause on government student loans and how to prepare for repayments resuming.
Buncombe County and the City of Asheville release application for property tax assistance program.
The details on the program and how to apply:
- Buncombe County and City of Asheville residents can apply for property tax assistance from the Homeowner Grant Program starting August 6th.
- The Homeowner Grant Program offers $300 of annual assistance to those who’ve lived in their homes for at least five years and meet income guidelines.
- You can apply the $300 to the property tax bill, city/municipality taxes and/or to other housing related obligations, such as housing costs, mortgage, or homeowners’ insurance. Payments are made directly to the company that issued the bill.
- Learn more about the Homeowner Grant Program and how to apply.
Update: 7/22/21 - Opting Out of Early Child Tax Credit Payments
Some families are opting out of the early 2021 Child Tax Credit payments to avoid owing taxes next year.
Why consider opting out of the early Child Tax Credit payments?
- These early Child Tax Credit payments are an advance on the payments you would normally get at tax time for your children.
- However, not everyone who receives the early payments, starting July 15th, will be eligible for all or some of the credit.
- The reason you may get payments and not be eligible? The information being used to calculate what you should get, your 2019 or 2020 tax returns, may no longer show an accurate income for your household. In addition, if a child is about to age out of eligibility or you are divorced and take turns claiming your children as dependents, your Child Tax Credit eligibility or the amount your eligible for could be impacted.
- This could lead to you owing on your 2021 taxes if your household income is more than 2019 or 2020.
- Even if your tax credit is calculated correctly, the advanced payments could lead to a smaller refund than you’re used to (or owing taxes at the end of the year), since any amount paid in advance will be taken out of the credit that’s applied at tax time.
- Read more about why people are opting out of the early 2021 Child Tax Credit payments.
What can you do to prepare for 2021 taxes?
- You can opt out of receiving the rest of the early Child Tax Credit payments by going to the IRS “Manage Advance Payments”. This would mean you would receive your correct Child Tax Credit after you file your 2021 taxes.
- If you do want to receive advanced payments but you’re unsure if you will have to repay part of the credit, you can put aside a portion of the early payments to pay taxes back if needed. We’d suggest saving 1/3 of the payments. For example, if you received an early payment of $300, you’d put aside $100 for taxes.
- You can also decide to get the early payments and use the money for your current needs, with the understanding that there is a possibility you could receive a smaller refund or owe taxes for 2021.
What can you do to prepare for 2021 taxes?
- Schedule a free Financial Counseling appointment with OnTrack WNC to create a budgeting plan that will work in your real life.
Update: 6/30/21 - Updates on Increased Child Tax Credit
The IRS Gives Next Steps for the Temporarily Increased Child Tax Credit
Here’s the timeline and what to expect:
- If you have children in your household under 18 years of age, you may be eligible to receive an increased Child Tax Credit with early payments. This increased Child Tax Credit is for tax year 2021 only.
- This year, qualifying families will receive monthly advance payments for the Child Tax Credit from July 15, 2021 to December 15, 2012. These payments will be paid around the same time each month.
- Advance payments will equal 50% of the total credit and will be based on your 2020 or 2019 tax return. The remaining 50% of the Child Tax Credit will be paid out to you after you file your taxes for 2021.
- If the IRS has your banking information, your payments should be direct deposited into your bank account. If the IRS doesn’t have your bank information, they will send you a check in the mail.
- If you want to view your eligibility for these payments, see your advanced payments, or if you want to unenroll from getting advance payments (you’d get the entire amount when you file your 2021 taxes), you can go to the IRS’s Child Tax Credit Update Portal
- You can find out more about the advance payments and Child Tax Credit on the IRS’s website.
Update: 5/3/21 - IRS Tax Refund Delays and Access to Free Credit Reports
IRS Delayed in Sending Tax Refunds to Some Americans
The IRS is behind on sending out some tax returns because of tax changes, limited resources, and an outdated IT system.
What’s going on and why is there a wait?
- Typically, the IRS sends out your tax return within 21 days or less, but the wait for your 2020 tax return could take six to eight weeks or longer.
- The IRS is manually reviewing more tax returns this year because some of the tax codes changed (Earned Income Tax Credit and the Additional Child Tax Credit) in December 2020 when the new stimulus bill was signed. The IRS didn’t have time to prepare their computer systems for the changes.
- If you filed for Economic Impact Payments (stimulus payments you didn’t receive in 2020), there may be delays in your return because the IRS is having to review your 2019 income and check for stimulus payments you already received to make sure they’re sending you the correct refund.
- You may also experience a delay in receiving a refund if there was an error when you filed your taxes or if the IRS identifies a possible fraud issue that requires you to follow-up with the IRS.
- The IRS doesn’t have a timeline for these issues to be resolved, but the "Where's My Refund Tool" may be useful in determining your refund status. Calling the IRS won’t speed up your refund timing.
- Read more in the news about the tax refund delay.
Equifax, Experian, and Transunion extended access to weekly free credit reports.
What you need to know?
- You can get all three of your credit reports weekly for free until April 20, 2022.
- Credit scores are not included with the free credit reports, but you can see your payment history, current creditors, some of your past creditors, and collections (if you have any).
- To get your free credit reports, go to AnnualCreditReport.com.
- Read more about free credit reports.
Update: 3/25/21 - Tax and Health Insurance Updates
The American Rescue Plan reduces taxes on unemployment income, raises the child tax credit, and makes marketplace health insurance more affordable.
You might not have to pay taxes on some or all of your unemployment income from 2020.
- If you received unemployment benefits in 2020 and your household made less than $150,000, you may not have to pay taxes on the first $10,200 of your unemployment income.
- If you haven’t filed your 2020 taxes yet and you received unemployment in 2020, you may want to hold off on filing until the IRS is able to put the new exemption in place.
- If you already filed your 2020 taxes and you received unemployment, wait for communications from the IRS on next steps. The IRS doesn’t recommend submitting an amended return at this time (this could change) for 2020 returns that were impacted by the change to taxes on unemployment income.
- Read more about the tax exemption.
- Read about the IRS’s guidance on the unemployment tax exception for 2020.
What’s going on with the child tax credit?
- Beginning in July 2021, if you make under $75,000 as a single person or up to $150,000 as a couple, you could receive a Child Tax Credit of $3,600 for each child under 6 and $3,000 for each child 6 to 17 years old. This is an increase from $2,000 in prior years.
- Instead of getting the entire Child Tax Credit at tax time, you will get monthly payments currently set to start in July and run through December 2021. Any remaining Child Tax Credit will be paid to you in your tax refund for 2021. Reminder: 2021 taxes are filed in early 2022.
- Read more about the temporary Child Tax Credit Increase.
How has health insurance changed in the Healthcare.gov marketplace?
- If you get health insurance through Healthcare.gov, you could see your monthly premium (cost) come down. For example, a family of four making $90,000 could see their monthly payment lower to $200 per month.
- If you have COBRA insurance while you’re unemployed, the new plan through Healthcare.gov could help subsidize monthly payments.
- Find out more information about the American Rescue Plan.
Update: 5/7/20 - Free Weekly Credit Reports
Protecting Your Credit During COVID-19
With fraud and identity theft on the rise as a result of COVID-19, now it is more important than ever to pay attention to your credit report.
Pull Your Credit Report Weekly FOR FREE through April 2022
- Experian, Transunion, and Equifax are now offering free weekly online credit reports, continuing through April 2022.
- Your weekly reports can be pulled through the only truly free website, www.annualcreditreport.com.
- You might wonder why this doesn’t include a free score. Scores are used by lenders to determine your credit worthiness for getting a loan. When reviewing your credit report for any potential fraud or errors, there is no need to see your score.
Check Your Credit Report Carefully for Fraud
After pulling your reports, check them to make sure:
- You recognize every account and your identifying information is correct.
- Any credit inquiries were approved by you.
- Any account in forbearance or deferment is being reported as current, as required by the CARES Act, if it was in good standing before any pandemic-related concessions were made.
Dispute Errors and Report Fraud
- If you see errors on your credit report, you can dispute them. Here’s how.
- If an error suggests identity theft — such as addresses you don’t recognize or accounts you don’t recognize — report it here.
Update: 4/24/20 - Health Insurance After Job Loss
Health Insurance After You Lose Your Job
If you have lost your health insurance as a result of job loss, there are different options to help you stay insured.
Keep Your Employer’s Coverage Through COBRA or NC State Continuation Coverage
- COBRA allows you to keep health insurance for up to 18 months after you lose your job.
- You can stay with your current provider but will have to pay the full premium.
- Talk to your employer about options for this.
Get Coverage Through the Affordable Care Act Health Insurance Marketplace
- You may be able to apply if you qualify for a “special enrollment period” due to losing your coverage through work.
- You have 60 days after losing employer coverage to apply.
- Pisgah Legal Services offers free local help to understand your options with the Affordable Care Act Health Insurance Marketplace. Learn more here.
Apply for Medicaid
- Families with dependent children may qualify if income has decreased significantly such that it falls under program limits. Other individuals may qualify under specific circumstances.
- You can apply online to see if you’re eligible here.
If Married, Try to Get Coverage Through Your Spouse’s Employer
- Contact your spouse's employer to see if you are eligible to join their plan. Make sure to check the cost of the extra coverage and compare it with other options.
If You’re 65 or Older, Sign up for Medicare (or add Part B)
- Council on Aging offers free local help to understand your options with Medicare. Learn more here.
- Alternatively, you can sign up through the Social Security website even if you're not ready to take Social Security.
- To add Part B, you must apply within 8 months after you leave your job and lose employer coverage to apply.
Read More Here
- AARP Article
- CNN Article
- Even better, check out the Federal Health Insurance Marketplace’s Coronavirus page.
Update: 4/20/20 - Crisis Times are Breeding Grounds for Scams. What to Watch Out For.
Defend Yourself Against Scams
The Best Defense Is to Not Give Any Information. The Consumer Financial Protection Bureau says that the best defense against scammers is to say NO if anyone contacts you and asks for personal information.
- Don’t provide your Social Security number, bank account number, credit card information, Medicare ID number, driver’s license number or any other personally identifiable information when solicited by phone, text, social media, email, or in person.
- If the person contacting you identifies as someone from a company where you conduct financial business, contact that business directly (by calling a phone number you know is legitimate; not the number the person contacting you provided) and ask if the request for information is legitimate.
- Report scams with the Federal Trade Commission here, by calling -877-5-NO-SCAM, or with the NC Department of Justice here.
How Scammers are Trying to Contact You
- Email. Do not open emails that look suspicious. And do not trust emails asking you to take an action such as to click a link, open an attachment, call a provider, or send personal information. If you think it is from a provider you trust, search for the institution online and find a contact number to call and ask for verification that the communication is valid. Before opening an attachment or clicking on a link in an email, ask yourself: Do you know who sent it? and Were you expecting it from them? If not, don’t click the link or open the document.
- Robocalls and Phone calls. If you receive an automated robocall (a call that sounds like a computer-generated voice) or a call from a person you don’t know or weren’t expecting to hear from, hang up. Don’t say anything or engage, just hang up.
- Text. If you receive a text from someone you don’t know or someone soliciting you for business or money, do not respond to the text.
- In person and via social media. If someone you don’t know contacts you to sell you something or asks for personal information, do not provide payment or any personally identifiable information as they may use it to scam you.
Common Scams to Watch Out For
Stimulus Check Scams
Stimulus check scams are happening in different ways. Know the following and steer clear of a scam:
- The U.S. government won’t be calling, texting, or emailing people individually to ask them to verify their bank account details or other personal information.
- There is no processing or setup fee necessary to receive this payment.
- Do not sign over your stimulus check to anyone promising you something better.
- It is not possible to receive a tax refund or stimulus check any faster by paying a person or service to help you. If someone says they can do that, they are a scammer.
- If you receive a paper check, all you need to do is deposit it in your bank account. If you receive information otherwise (such as guidance to call a number or verify information online in order to cash it) that is a scam.
Social Security Fraud
Fraudulent letters are being sent that threaten suspension of Social Security benefits due to COVID-19 or coronavirus-related office closures. The letters tell the recipient to call to get the money reinstated and then scammers steal personal information or money.
- The Social Security Administration (SSA) will not suspend or discontinue benefits because their offices are closed. Any communication you receive that says SSA will do this is a scam.
- Report Social Security scams here.
Fake COVID-19 Charity Scams
- A charity scam is when a thief poses as a real charity or makes up the name of a charity that sounds real to get money from you.
- Be careful about any charity calling you asking for donations. If you want to make a donation to a specific charity, reach out to them to make that donation.
Person in Need or Imposter Scams
- Some scammers are using the circumstances of COVID-19 to pose as a grandchild, relative, or friend who claims to be ill, stranded in another state or foreign country, or otherwise in trouble and asks you to send money.
- If you receive such a call, hang up and call your grandchild, relative or friend’s phone number to see if the story checks out.
Be Aware About Price Gouging. You are Protected.
- North Carolina’s price gouging law is in effect, which makes it illegal to charge too much during a crisis for items.
- If you think there is a case of price gouging, contact NC Department of Justice at 1-877-5-NO-SCAM, or by clicking here.
Stay Up-to-Date on the Latest Frauds
AARP’s Fraud Watch Network.
Sign up here for the latest information on frauds and scams to keep you and your loved ones safe.
NC Attorney General’s Office.
Sign up here for alerts about new scams.
Want More Information
Helpful links and articles
- NC Department of Justice Consumer coronavirus update.
- Attorney General Josh Stein’s coronavirus scam guide.
- Consumer Finance Protection Bureau blog and article about scams.
Helping to manage someone’s money and need guidance?
- Check in by phone or video chat. Stay in touch to know how they’re handling things and so they know you’re thinking about them.
- Ask questions. If your loved one mentions concerns about money or has spotted unusual activity in their accounts, ask for details. Older adults and their family members can learn about common types of scams, as well as how to avoid and report them by checking out the Pass it On and Money Smart for Older Adults programs.
- Financial caregivers: learn more about your responsibilities. The CFPB’s Managing Someone Else’s Money guides can help you understand your role as a fiduciary. Each guide explains your responsibilities, and how to spot financial exploitation and avoid scams.