Public Service Loan Forgiveness

The PSLF Program forgives the remaining balance on your Direct Loans after you have made 120 qualifying monthly payments under a qualifying repayment plan while working full-time for a qualifying employer.

Bevo is a few months from graduating from the University of Texas at Austin with a loan balance of $23,548. He will be taking a position in the non-profit sector with an annual salary of $30,000! He went to a workshop hosted by the Texas Financial Wellness team and learned about a program that forgives a portion of your loans for working in public service. He used a Public Service Loan Forgiveness calculator and found out he could save $8,473 if he continued to work in public service for the next 10 years. Here’s a breakdown of Bevo’s savings!

Personal Info: Bevo
Adjusted Gross Income: $30,000
Family size: 1
Annual income growth: 3.5%

Total Federal Student Loan Balance: $23,548 
Average Weighted Interest Rate: 5.7%

Public Service Loan Forgiveness Student Scenario

Repayment Plan Standard IBR ICR PAYE REPAYE
First month’s payment $258 $149 $166 $99 $99
Last month’s payment $258 $233 $177 $155 $155
Total balance paid $30,948 $22,613 $20,498 $15,075 $15,075
Total forgiveness N/A $11,895 $14,171 $21,726 $21,598
Total savings N/A $935 $3,050 $8,473 $8,473
Repayment term 10yr 10yr 10yr 10yr 10yr

Use the PSLF Calculator to see if the program is right for you!

  • Full time paid public service position
  • Public service positions include:
    • US federal, state, local or tribal government
    • Not for profit organizations (501 c (3))
  • Example employers include:
    • Public Colleges and Universities
    • Health and Human Services
    • AmeriCorps
    • Department of Justice
    • Federal Bureau of Investigation
    • Public School System

The plan you select must be one of the Income Driven Repayment Plans (link repayment plans webpage for more detailed information on each repayment plan)

  • Pay as you Earn
  • Revised Pay as you Earn
  • Income Based Repayment
  • Income Contingent

  • The Employment Certification Form ensures you are on the right track as you continue to make payments and change employers.
  • The ECF should be completed and submitted annually or when you change employers.
  • Use the PSLF Help Tool to fill out the form, then print it out, have it signed by your employer and either mail to the address below or fax to 717-720-1628!

    U.S. Department of Education
    FedLoan Servicing
    P.O. Box 69184
    Harrisburg, PA 17106-9184

  • If FedLoan Servicing is your servicer, you can upload your form to their website!

  1. Make 120 monthly payments under an Income Driven Repayment Plan while working for a qualifying employer.
  2. Ensure you have completed and submitted the Employment Certification Form(s).
  3. Use the PSLF Help Tool or download the paper application and submit via mail to the address below or fax to 717-720-1628.

    U.S. Department of Education
    FedLoan Servicing
    P.O. Box 69184
    Harrisburg, PA 17106-9184

If your application is approved:

  • You will be notified that the entire remaining balance of your eligible Direct Loans will be forgiven.
  • If you made payments after the 120th payment, you will be refunded.

If your application is denied:

  • You will be notified with the reasoning for your denial and resume making payments.

Good news: Any amount forgiven under the PSLF program will not be considered income by the IRS and you will not have to pay federal income tax on that amount!

FedLoan Servicing administers the PSLF program, therefore for any questions or concerns contact:

U.S. Department of Education
FedLoan Servicing
Call: 1-800-699-2908
Monday through Friday 8:00 AM to 9:00 PM (ET)