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Public Service Loan Forgiveness (PSLF)

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An Update on Regulation Changes to the PSLF Program

Federal Student Aid is implementing regulatory changes to the Public Service Loan Forgiveness (PSLF) Program effective July 1, 2023. MOHELA's communication channels regarding these regulatory changes will be updated in the coming week. Please visit StudentAid.gov for current updates to the PSLF Program.

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Income-Driven Repayment (IDR) Effects on PSLF

If you have 12 or more months of consecutive forbearance or 36 or more months of cumulative forbearance, you will receive PSLF credit for those periods of time if you certify qualifying employment. Please allow for the PSLF counts to be updated automatically Fall 2022. If you believe you might benefit, you should update your employment certification history to reflect all periods of public service employment. For more information please visit StudentAid.gov/IDRAdjustment.

If you work in certain public service jobs and have made 120 payments on your Direct Loans, you may be eligible to have your loans forgiven. Learn More about Public Service Loan Forgiveness.

Note: Suspended Payments Count Toward PSLF and TEPSLF During the COVID-19 Administrative Forbearance. If you have a Direct Loan and work full-time for a qualifying employer during the payment suspension (administrative forbearance), then you will receive credit toward PSLF or TEPSLF for the period of suspension as though you made on-time monthly payments in the correct amount while on a qualifying repayment plan.

Temporary Expanded Public Service Loan Forgiveness (TEPSLF)

If some or all of your payments were not made on a qualifying repayment plan for PSLF, you may be able to receive loan forgiveness under a temporary opportunity. Learn more about the Temporary Expanded Public Service Loan Forgiveness program.


Tax Implications if Your Loans are Forgiven

Beginning January 1, 2021, amounts forgiven under the PSLF Program are not considered income by the Internal Revenue Service. Therefore, you will not have to pay federal income tax on the amount of your Direct Loans that is forgiven.

The discharged loan amount may be considered income for state tax purposes. You may want to consult with your state tax office or a tax professional before you file your state tax return.