PSLF Eligibility Requirements
To successfully receive loan forgiveness, borrowers must meet four key criteria. Failing to meet even one requirement can pause or disqualify your progress, so it’s essential to understand each component.
1. Qualifying Employer
You must be employed full-time by a qualifying public service organization. This includes:
- Government Organizations: Any U.S. federal, state, local, or tribal government agency. This covers public school teachers, military members, and city employees.
- 501(c)(3) Non-Profits: Most tax-exempt non-profit organizations, such as charities, non-profit hospitals, and food banks, qualify.
- Other Non-Profits: Certain non-profits that are not 501(c)(3)s may also qualify if they provide a designated public service, like public health or safety.
For-profit corporations, labor unions, and partisan political organizations are generally not qualifying employers. To confirm your employer’s eligibility, use the official PSLF Help Tool on StudentAid.gov.
2. Qualifying Loans
Only loans from the William D. Ford Federal Direct Loan Program (Direct Loans) are eligible for PSLF. If you have older federal loans, such as Federal Family Education Loans (FFEL) or Perkins Loans, you can make them eligible by combining them into a new Direct Student Loan Consolidation Loan. However, only payments made after consolidation will count toward PSLF. Private student loans are never eligible.
3. Qualifying Repayment Plan
You must make payments under a qualifying Income-Driven Repayment (IDR) plan. These plans calculate your monthly payment based on your income and family size. The most common eligible plans include:
- Saving on a Valuable Education (SAVE)
- Pay As You Earn (PAYE)
- Income-Based Repayment (IBR)
- Income-Contingent Repayment (ICR)
The Standard 10-Year Repayment Plan is not an ideal option for PSLF, as it is designed to pay off your loan in exactly 120 payments, leaving no remaining balance to forgive.
4. 120 Qualifying Payments
A qualifying payment is one made after October 1, 2007, for the full amount due, within 15 days of your due date, while you are employed full-time by a qualifying employer. These 120 payments do not need to be consecutive. If you leave public service and later return, you can resume your progress.
How to Stay on Track for PSLF
Navigating the PSLF program requires careful record-keeping and proactive steps.
- Certify Your Employment Annually: Don’t wait ten years to verify your eligibility. Submit the PSLF Certification & Application form annually and anytime you change jobs. This ensures your employer qualifies and provides an official, ongoing count of your qualifying payments.
- Keep Your Own Records: Save copies of all submitted PSLF forms, payment confirmations, and correspondence from your loan servicer to create a personal paper trail.
- Is Forgiveness Taxable?: One of the program’s most significant benefits is that, under current law, the forgiven loan balance is not considered taxable income by the federal government through 2025. According to the Internal Revenue Service, this provision helps maximize the financial relief for public servants.
Frequently Asked Questions (FAQs)
What happens if I switch to a private-sector job?
Your progress toward PSLF is paused. The qualifying payments you already made remain on your record. If you return to a qualifying public service job, you can pick up where you left off.
Do I have to work for the same employer for all 10 years?
No, you can work for multiple employers as long as each one is a qualifying public service organization. Remember to submit a new PSLF certification form whenever you change jobs.
What if I made payments on the wrong repayment plan in the past?
The Department of Education has made a one-time account adjustment to credit borrowers for certain past periods of repayment, forbearance, and deferment that would not have otherwise counted. Check your account status on StudentAid.gov for details on how this may have affected your payment count.