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Worth Another Look: Public Service Loan Forgiveness

by Mary Alice Scott

For years, the Public Service Loan Forgiveness (PSLF) program has been notoriously difficult to navigate, and many people had written it off entirely. We’re here to tell you that it’s worth another look!

The Public Service Loan Forgiveness program (not to be confused with the recently announced student debt cancellation) is a program which fully forgives the balance on federal student loans for certain employees who have made 120 qualifying payments while working at a 501(c)(3) or other public service-designated employer.

A temporary waiver is now in place (through October 31, 2022) that could turn previously negative experiences upside down – and makes debt forgiveness (or credit toward forgiveness) easier than ever. After these temporary changes were made in 2021, more than $11 billion in debt has been forgiven. (This waiver has been extended several times since it was announced, but it will not be extended again.)

If you work full-time at a nonprofit, your debt could be forgiven, too! As a result of a recent program expansion, thousands of nonprofit employees can receive credits for past periods of repayment that would otherwise not qualify. These temporary expansions are set to expire on October 31, 2022.

Employees

Take action NOW! You only have until October 31, 2022 to sign up to take advantage of the PSLF requirements that are different under the waiver. See the graphics on this page to determine if you should apply, and see how the requirements have changed.

How-To-FAQs for PSLF: This resource, developed by Independent Sector and the National Council of Nonprofits, provides the ones and twos on PSLF how-to-dos. PSLF stakeholders can use this FAQ sheet when completing the application and certification processes.

  1. Check your eligibility for the limited-time PSLF waiver at https://studentaid.gov/PSLF or take the quiz (scroll down a little bit) on this website
  2. Tell as many other nonprofit workers as you can!

Employers

This program is a vital part of attracting and retaining employees in the nonprofit workforce, and it’s important to get the word out as much as possible! Share this information with your employees. It could make a BIG difference! 

Here are three things your nonprofit can (and should) do today to help ensure that your eligible employees take advantage of the temporary PSLF wavier:

  1. Remind your employees about the temporary PSLF waiver and the October 31 deadline in any upcoming staff meetings or communications with your employees. You can share the U.S. Department of Education’s free resources about the waiver (note that the website has had some delays recently due to the high level of interest in the waiver). You can use this sample email, or the graphics and posters provided in this toolkit, to support your outreach and education efforts.
  2. Make it easier for your employees to apply for the waiver by ensuring they know your nonprofit’s employer identification number (EIN) and the contact information for the person on your staff to direct PSLF forms and related questions.
  3. Encourage your employees to check out The Institute of Student Loan Advisors (TISLA), a nonprofit with free information about PSLF, how you might qualify, and all things student loans.

Also good to know: earlier this summer, the Department of Education proposed some rule changes which would codify some (but not all!) of the PSLF changes. This chart goes into more detail about the proposed changes.

 

MANP is a proud member of the National Council of Nonprofits, a network of nonprofit state associations across the country, and trusted resource and proven advocate for America’s charitable nonprofits. Thank you to the National Council of Nonprofits, and Independent Sector, and North Carolina Center for Nonprofits for compiling many of the resources above.

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