Student Loan Pause Extended to May 1, 2022

At-A-Glance:

• U.S. Department of Education announced a final extension of the pause on student loan repayment, interest, and collections until May 1, 2022.
• The Department will begin notifying borrowers about this final extension in the coming days.
• The goal of this final action is one of a series of steps the Department has taken to support students and borrowers, make higher education more affordable, and improve student loan servicing.

U.S. Department of Education Extends the Student Loan Pause

On August 6, 2021, the U.S. Department of Education extended the pause on student loan repayment, interest, and collections through January 31, 2022, and on December 22, 2021, the deadline was extended until May 1, 2022. With a definitive date established and additional time, the Department feels this will allow borrowers to make plans for resuming payments and reduce delinquencies.

The Department plans to continue its work to transition students and borrowers smoothly back into repayment, including by making higher education more affordable and improving student loan servicing, including:

• Approving $1.5 billion in borrower defense claims, including extending full relief to approved claims and approving new types of claims.
• Reinstating $1.3 billion in loan discharges for 41,000 borrowers who received a total and permanent disability discharge and protecting another 190,000 from potential loan reinstatement.
• Helping 30,000 small business owners with student loans seeking help from the Paycheck Protection Program.

The Department will begin notifying borrowers about this final extension in the coming days, and it will release resources and information about how to plan for payment restart as the final pause end date nears.

Thank you for choosing Paylocity as your Payroll Tax and HCM partner. This information is provided as a courtesy, may change and is not intended as legal or tax guidance. Employers with questions or concerns outside the scope of a Payroll Service Provider are encouraged to seek the advice of a qualified CPA, Tax Attorney or Advisor.