Public Service Loan Forgiveness: Who Qualifies and How the 120 Payments Count

1Test 1: the right loans

Only federal Direct Loans qualify: Direct Subsidized, Unsubsidized and PLUS loans, and Direct Consolidation Loans. Loans from the older Federal Family Education Loan program and Perkins loans do not, unless you consolidate them into a Direct Consolidation Loan. Payments made on the old loans before consolidation generally do not count, so consolidate early if you are in public service and have them.

Parent PLUS loans have their own, narrower rules and must be consolidated to qualify. Private student loans never qualify. Your loan types are listed in your StudentAid.gov account; our guide to subsidized and unsubsidized loans explains the federal types.

2Test 2: the right repayment plan

Payments count only under certain plans. The safe choices are an income-driven plan, the Repayment Assistance Plan, which opened on July 1, 2026, and the 10-year Standard plan. Most other plans, such as graduated or extended plans, generally do not produce qualifying payments, and on the 10-year Standard plan the loan would be paid off at the end of ten years anyway, leaving nothing to forgive.

That is why most borrowers aiming for PSLF use an income-driven plan or RAP: the payment is set by income, often well below what the loan would otherwise require, and whatever is left after 120 payments is forgiven. Our guide to repayment plans compares RAP, the Standard plan and income-based repayment.

3Test 3: the right employer

What counts is who employs you, not what job you do. Qualifying employers include:

• Government organizations at any level: federal, state, local or tribal, including public schools, public universities, public hospitals, the military and public safety agencies.
• Nonprofits exempt under section 501(c)(3) of the tax code, such as most charities, private nonprofit hospitals and nonprofit colleges.
• Some other nonprofits that provide certain public services, such as public health, public education or emergency management, even without 501(c)(3) status.
• Full-time AmeriCorps or Peace Corps service.

Contractors working for a government agency usually do not qualify, because the employer is the contracting company, not the agency. Labor unions, partisan political organizations and for-profit companies do not qualify. The PSLF Help Tool on StudentAid.gov lets you search for an employer by its federal employer identification number.

A rule that took effect on July 1, 2026, lets the Department of Education remove qualifying status from an employer it finds has a substantial illegal purpose, after notice and a chance to respond. Only conduct on or after that date counts, and borrowers keep credit for their payments until such a finding takes effect.

4Test 4: full-time work

You must be employed full time, which for PSLF means the greater of your employer's definition of full time or an average of at least 30 hours a week. Hours at more than one qualifying employer can be combined to reach 30. For teachers and others on contracts of at least eight months a year, the school year counts as full time for the full year.

You must be working for a qualifying employer when you make each payment you want counted, when you apply for forgiveness and when it is granted.

5How the 120 payments are counted

A qualifying payment is a monthly payment, in the full amount due, made on time under a qualifying plan while you work full time for a qualifying employer. The payments do not have to be consecutive: a few years in the private sector simply pause the count, and it resumes when you return to public service.

Some months count even without a payment. Since 2023, months in certain deferments and forbearances, such as those for cancer treatment, military service or AmeriCorps, can count toward PSLF. For other months in a deferment or forbearance that did not count, a buyback lets you pay what you would have paid then, but only if those months would bring you to 120 and you had qualifying employment during them.

6A count in practice

Ana's two private years did not reset her count, but they did push forgiveness later. Part-time work would also have counted if her hours at qualifying employers had added up to 30 a week.

7Common reasons payments do not count

• The wrong loans, such as FFEL loans that were never consolidated, or private loans.
• The wrong plan, such as a graduated or extended plan.
• Payments not made on time, or for less than the full amount due.
• Months in forbearance that are not among the kinds that count, even if you paid voluntarily.
• Employment that was never certified, which leaves months unverified until you submit a form for that employer.

8Keeping your count on track

1. Certify your employment with the PSLF form through the PSLF Help Tool each year and whenever you change employers. Your employer signs electronically.
2. Check your count on your StudentAid.gov dashboard after each certification, and question any month that seems missing.
3. Keep your income-driven plan current by recertifying income on time, so payments stay in a qualifying plan.
4. Keep records: pay stubs, W-2s and the employer's identification number for every job.

When you reach 120 qualifying payments, submit the same PSLF form, choosing forgiveness. Keep making payments until you hear that the balance has been discharged; any payments made after you qualified are refunded.

9Taxes and other forgiveness

Forgiveness under PSLF is not taxable income for federal tax purposes, unlike the balance forgiven at the end of an income-driven plan, which the Department of Education says may be counted as income. Most states follow the federal rule, but check yours. Teachers in low-income schools can also look at Teacher Loan Forgiveness, which forgives up to $17,500 after five years of teaching, though the same years cannot count toward both programs.