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Capital Gains / Community Property and Significant Change in Income
March 13, 2019
6:11 pm
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SH04
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I just got off the phone with Nelnet. My 2017 taxes were filed jointly because I sold assets so I had capital gains of around 35000. However, my wages/salary has only risen by a few percentage points since then. I asked if this would be a significant change in income and the lady talked to the processing department. Processing told her that I wouldn’t count the capital gains as part of the income calculation for determining a significant change.

The second issue is I live in a community property state. This year we filed separately, so my income dropped by 20,000 from what my W2 says (in addition to not reflecting the capital gains). I asked if I did have a change in income and they wanted to verify using pay stubs, that it would not be reflective of my IRS tax return and how would I make it clear that my income is shared with my wife 50/50 and that is what is on my IRS return. She didn’t respond to this one really and just said to submit my wife’s and my separate tax returns and that should be enough. So I will do that and not indicate that there was a significant change in income.

Also, I asked her specifically about the wording of the significant change in income questions: “Has your income significantly changed since you filed your last federal income tax return?” I said: Hey, I just filed my tax return, so when I submit this I may refer to the last return I actually filed, right? She responded that they are asking about income since last re-certification. I said that is pretty clearly the intent of the question because otherwise it is pointless, but I said that according to the plain language on the form you could make a serious argument that they are asking literally if anything has changed since filing the last tax return, even if that was the day before submitting the new IBR request.

March 14, 2019
12:05 pm
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Indiana
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May 3, 2014
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They really do a lousy job of defining a “significant” change in income. Each time I’ve spoken with a loan servicer about this exact issue I’ve gotten a slightly different answer.

Were you able to get things squared away with your servicer or is there still an issue to be resolved?

March 14, 2019
4:14 pm
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SH04
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Thanks for posting my comment Michael.

I didn’t get resolution on the community property issue specifically, but either way it really sounded like they only wanted a tax return and were not interested in reviewing the alternative income documentation. I will mark no significant change to income and if they have any issues they should follow up with me.

Also, if they do have issues I will request a temporary forbearance because now that I know I can have 800 more dollars a month to support my family I don’t want to pay it even one more month.

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