Public Service Loan Forgiveness

The Public Service Loan Forgiveness (PSLF) program is a federal student loan forgiveness program that forgives the remaining balance on eligible federal student loans for borrowers who work full-time in qualifying public service or nonprofit jobs and make 120 qualifying payments. To be eligible for PSLF, borrowers must meet the following requirements:

1. Have eligible federal student loans, such as Direct Loans (subsidized and unsubsidized), PLUS Loans for parents, or Grad PLUS Loans.

2. Be employed full-time in a qualifying public service or nonprofit job. Qualifying employers include government organizations (federal, state, or local), tax-exempt nonprofit organizations under Section 501(c)(3) of the Internal Revenue Code, and other types of nonprofit organizations that provide qualifying public services.

3. while working full-time for an eligible job, make 120 qualifying payments under a qualifying repayment plan. The 10-year Standard Repayment Plan and all income-driven repayment plans fall under the category of qualifying repayment plans.

4. Meet other program requirements, such as making payments on time and submitting an Employment Certification Form each year to verify employment and payment eligibility.

After making 120 qualifying payments, the remaining balance on the borrower's eligible federal student loans is forgiven tax-free. It's important to note that PSLF forgiveness is not automatic and borrowers must apply for forgiveness after making 120 qualifying payments.

The PSLF program can be a valuable option for borrowers working in public service or nonprofit jobs who are struggling to repay their federal student loans. However, it's important to carefully review program requirements and ensure that all employment and payment eligibility criteria are met to qualify for forgiveness.