Public Service Loan Forgiveness FAQ

Anyone working in public service deserves consideration on the question of their student loan debt being forgiven. However, no matter how effective these programs, it’s often easy to become bogged down in technical jargon and general confusion regarding what exactly may be enacted or expected of you. Check out our public service loan forgiveness FAQ to gain greater knowledge of the program as a whole.

There is no specific income requirement for Public Service Loan Forgiveness. However, under almost every qualifying PSLF program, your monthly payments will be based completely around your income. Therefore any changes in your income level over the course of your public service employment may be considered when deciding whether or not you have a remaining balance after 120 payments.

Unfortunately, you cannot. The Public Service Loan Forgiveness program is a congressional program, and it is on Congress to decide if it stays or goes. However, this shouldn’t be too much of a deterrent, as, worst case scenario, you’re right back to where you started having had an interim of income based payment.

Not at all! This is one of the major reasons that the Public Service Loan Forgiveness program is considered to be one of the best in its class. According to the IRS, loans forgiven are not considered as taxable income by the IRS and therefore prevent you from any liability. However, it never hurts to get more information by checking with the IRS or a tax advisor.

Unfortunately, no. Any consolidated loan after making payments will lose the credit towards Public Service Loan Forgiveness achieved by those payments. Should this happen, you will have to start over again with 120 payments to go. For this reason, should consolidation become your choice, it may be much more prudent to leave your direct loans out of the consolidation and include only your loans from other federal student loan programs.

No. Private education loans cannot be consolidated into a direct consolidation loan and therefore are not available for Public Service Loan Forgiveness.

No. However, these loans may become eligible for Public Service Loan Forgiveness if you can resolve the default.