Under a temporary expansion of a key federal student loan forgiveness program for public service workers, thousands of jobs will qualify, and a million borrowers may ultimately benefit. Here are the details. The Public Service Loan Forgiveness (PSLF) program can wipe out the federal student loan debt for borrowers committed to public service careers. PSLF was established in 2007, but its original eligibility rules were complex and poorly communicated to borrowers. PSLF restricted student loan forgiveness to borrowers with Direct-program federal student loans only; other types of federal student loans were excluded. The program also required borrowers to repay their loans under an income-driven repayment plan, leaving out borrowers who were making payments under most other plans. Last October, the Biden administration announced a broad, temporary new initiative to expand PSLF relief. Called the “Limited PSLF Waiver, the expansion will allow borrowers to get credit for periods of repayment that wouldn’t have qualified under the original PSLF rules. This includes past payments made on non-Direct federal loans (like FFEL loans and Perkins loans), as well as payments made under non-qualifying repayment plans. According to the Biden administration, 70,000 borrowers have already received $5 billion in student loan forgiveness under the waiver, and officials expect hundreds of thousands more to ultimately benefit from the temporary relief. The employment requirements for the PSLF program remain largely unchanged under the waiver. But many borrowers may not fully realize the broad employment eligibility that already existed under the program. Coupled with the other changes to PSLF through the waiver, many jobs may now qualify for student loan forgiveness. Here’s a breakdown. Full-time employment for designated 501(c)(3) nonprofit organizations generally qualifies for PSLF. Many nonprofit organizations are 501(c)(3)s including private nonprofit academic institutions, nonprofit hospitals, and charitable organizations. Nonprofit organizations that are not 501(c)(3)s may or may not qualify. For example, partisan political organizations and labor unions generally won’t be eligible. Other types of nonprofit organizations may or may not count, but the Department makes those determinations on a case-by-case basis. Full-time employment for any domestic government entity would qualify for PSLF as well, in most cases. This would include a government agency at any level (federal, state, or municipal) as well as public institutions, like public schools. Employment for quasi-public agencies or private organizations established by governments may not count, although it depends on the specific characteristics of that organization. In addition, foreign government entities or international organizations, and private for-profit contractors working for government entities, are generally excluded from PSLF eligibility.
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