If you’ve ever found yourself scratching your head about Public Service Loan Forgiveness (PSLF), you’re not alone. The rigid nature of the program coupled with incorrect guidance and buried information has left many eligible borrowers missing out on the opportunity to have their loans forgiven after making 120 qualifying payments.
In particular, it can be challenging to figure out whether or not your employment makes you eligible for PSLF. First, there’s the question of which types of workplaces qualify. There’s also confusion around the type of job you need to hold as well as what it means to work “full-time.”
We’re here to help you make sense of these PSLF employment requirements and understand if you’re eligible for the program.
Let’s Start With Employers
Federal, state, local, and/or tribal government agencies are all qualifying employers for PSLF. This includes agencies explicitly associated with the government—think military, health departments, etc.—as well as those that engage more regularly with civilians, such as public schools and public transportation.
Certain nonprofit organizations can also meet PSLF’s employer requirement. In this case, all 501(c)(3) organizations qualify, but only certain non-profits without (c)(3) tax-exempt status do.
In order for non-(c)(3) organizations to qualify, they have to provide at least one public service as listed by the Department of Education. And even though labor unions and partisan political groups are nonprofit organizations, they do not qualify for PSLF. (If you’re unsure about the tax-exempt status of your non-profit employer, the IRS’s Tax Exempt Organization Search Tool can help you find it.)
Lastly, AmeriCorps and Peace Corps can qualify as employers so long as you’re volunteering for either full-time. We’ll get into what “full-time” means in a bit.
Now, Let’s Talk Jobs and “Full-Time”
Given that the government has strict qualifications for employers, you might think only certain types of jobs at those employers are eligible for PSLF. Thankfully, that’s not the case. Any job works; the only requirements are that your employer is eligible for PSLF and that you’re a full-time employee.
For example, let’s say you work in office administration full-time at a nonprofit hospital. This would qualify for PSLF. However, if you worked full-time as a nurse at a private hospital, you wouldn’t be eligible.
So, what counts as full-time? The Department of Education considers you to be a full-time employee if you work at least 30 hours a week or meet your employer’s definition of full-time—whichever amount is greater. Employer-provided vacation and leave time also count toward your hours as a full-time employee. This means if you take family leave or temporary medical leave, as permitted under the Family and Medical Leave Act, you will still be recognized as a full-time employee.
All of this is pretty straightforward if you’re able to satisfy the full-time employment requirement through a single employer. But don’t worry if you’re working part-time: as long as you work a combined minimum average of 30 hours per week through part-time jobs at qualifying employers, you’re still eligible for the program.
For adjunct teachers and professors, the situation gets more complicated. Although these instructors can work for qualifying employers and spend hours on coursework and helping students, they often aren’t considered full-time as schools only recognize time spent teaching in class. As a result, it can be really difficult for adjuncts to qualify for PSLF.
If you work as an adjunct in California, a 2019 law allows you to count office hours and course preparation time toward your weekly hours. The Oregon legislature also recently passed a similar bill that multiples adjunct credit hours to qualify for PSLF. The “Adjunct Faculty Loan Fairness Act” bill, introduced in the U.S. Senate this past July, aims to implement a similar policy nationwide.
Okay, Let’s Get Certified
Under PSLF, borrowers who make 120 payments while working full-time for a qualifying employer will have the remaining balance of their Direct Loan(s) forgiven. These payments need to be made for the full amount—no more, no less—and no later than 15 days after the due date in order to count, but they do not have to be made consecutively.
If you work for an eligible employer and meet the full-time work requirement, you need to certify your employment in order to get credit for your loan payments. The certification process is straightforward: you fill out the PSLF form—which you can easily access online through Summer—with details about your employment, you and your employer both sign the form, and then you submit the form to the Department of Education. Once your form is approved, the Department of Education will give you a specific count of the number of qualifying loan payments you’ve made toward the 120 total required for forgiveness.
Certification isn’t limited to current employers. You can and should do this for previous employers too. PSLF launched in October 2007, so you can certify any qualifying employment you’ve had since then. (If your employer has since closed, you can still certify; the Department of Education may ask for more documentation to confirm.) Generally speaking, we recommend certifying your employment annually and anytime you change jobs.
Lastly, the Department of Education issued a limited waiver that expands the type of payment that qualifies under PSLF—but this expansion only lasts through October 31, 2022. So if you’ve made partial, late, or excessive payments in the past while working for an eligible employer, certify your employment so that the department can count those payments. It can take the department some time to process paperwork, so we recommend submitting those forms as soon as you can.
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