How to know if you work in the public sector and qualify for PSLF. Show  Written by Matthew Students who want to pursue careers in public service may be able to have their debt forgiven through the Public Service Loan Forgiveness Program (PSLF). As part of the College Cost Reduction and Access Act of 2007, student borrowers who have chosen careers in public service can become eligible for tax-free loan forgiveness under the PSLF program. But, what is considered public service for student loan forgiveness? How Student Loan Forgiveness WorksBefore defining what constitutes public service, it’s important to understand how the PSLF program works. Simply put, after making 120 qualifying payments, eligible borrowers who work full-time for federal, state, tribal, or local governments, as well as those who work for non-profit organizations, will be released from their obligation to pay the remaining balance on their federal direct student loans. Making qualifying payments can take 10 years, but as of April 2020, an average balance of $66,066 has been forgiven through the PSLF program! It is important to note that to be considered a full-time employee, you must render at least 30 hours per week with a qualified employer while making the 120 qualifying payments. These payments, however, don’t need to be made consecutively. Additionally, you’ll be required to submit a Public Service Employment Certification Form in order to prove that you are indeed worked and/or are working for a qualifying employer. What Qualifies as Public Service for Student Loan Forgiveness?To define what makes up public service employment, here’s a list of qualifying common job sectors by category: Working For a Non-Profit OrganizationThis includes organizations that are exempt from paying taxes under Section 501(c)(3) of the Internal Revenue Code. Also included are organizations that are not exempt from paying taxes under that code, but do provide qualifying services, which include the following: Public Safety
Public Interest Law
Public Education
Public Health
Other Public Services
Full-time volunteers for the AmeriCorps or Peace Corps are also recognized as qualified employment for the PSFL. What Doesn’t Qualify As Public Service for Student Loan Forgiveness?If you’re working for the following employers, you probably aren’t eligible for the PSLF:
Be in the knowWhile PSLF isn’t a perfect program, and it may take a long time before you can apply, it still pays to know whether or not you could be eligible! Take note of the requirements, as well as the eligible careers that can help you get tax-free relief from your federal direct student loans! jacoblund / Getty Images/iStockphoto With last week’s news regarding updated measures for federal student loan relief, the topic has been front of mind for many of the 43 million Americans who carry this type of debt. President Biden’s plan allows $10,000 in debt cancellation for anyone with a federal student loan who makes under $125,000 a year. Borrowers who received a Pell Grant can have up to $20,000 in debt cancelled. However, there have been other national student loan forgiveness programs in place for a while. See: 9 Bills You Should Never Put on Autopay One of them is the Public Service Loan Forgiveness program that allows remaining balances of federal student loan debt to be waived after the individual has made 120 consecutive payments — 10 years’ worth — since October 2007, when the program started. There are some qualifications to be eligible, as noted by the Federal Student Aid office of the U.S. Department of Education. The requirements include working full-time for an eligible employer; having a Direct loan (it must be a federal student loan); and being enrolled in an income-driven repayment plan. You must also make the full payment as noted on the bill and do so no later than 15 days after the due date. The Education Department recommends filling out a Public Service Loan Forgiveness (PSLF) & Temporary Expanded PSLF (TEPSLF) Certification & Application, also called a PSLF form, each year or whenever you change employers. This helps to ensure that your payments will be credited. You can receive credits even if you were on an allowable forbearance during the COVID-19 pandemic. So, who qualifies? It’s not so much about the job you do or even the title you hold but the employer you work for. Your employer must be a government organization, which includes the military and tribal organizations, or a tax-exempt 501(c)(3) non-profit. AmeriCorps and Peace Corps also qualify. Here are categories of work that can take part in the PSLF:
Indeed has its own search results for “Public Service Loan Forgiveness” jobs that point to a variety of positions, including sanitation workers, media professionals, property managers, patient care representatives, clinic coordinators and administrative workers. However, it should be stated that most people who have applied for PSLF have been denied, as there are very strict qualifications, as noted by Saving For College, citing data from the U.S. Department of Education. As of April 2021, 98% of applicants had been denied. Education Secretary Miguel Cardona has said that there is “extraordinary confusion” about the process. Biden has vowed to overhaul the PSLF program as part of latest student loan relief agenda. As the statement issued by the White House last week declared, Biden vowed to fix the “broken Public Service Loan Forgiveness (PSLF) program” to provide appropriate credits to eligible workers. The White House statement also noted that temporary changes enacted thus far have resulted in over 175,000 workers receiving more than $10 billion in loan forgiveness. Take Our
Poll: Are You Struggling To Keep Up With Your Utility Bills? Find more information about the loan forgiveness program and links to forms and applications on the StudentAid.gov Public Service Loan Forgiveness page, located here. More From GOBankingRates
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What jobs are considered public service for student loan forgiveness
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