The Federal Financial Protection Bureau is asking public service employers to make a pledge to help their employees with their student loan debt. In August 2013 the government began providing a student loan forgiveness toolkit for School Districts, Non-Profit Organizations, and other Public Service Employers so that they can be a resource for their employees with student debt. The idea is to help their employees understand who qualifies for existing student loan repayment benefits specifically the Public Service Loan Forgiveness Program.
Researching and understanding the loan repayment benefits can be challenging. The idea is with minimal guidance public service employees will learn early on how to manage their debt through loan forgiveness. Currently, under the Public Service Loan Forgiveness program after 10 years of public service and 120 qualifying monthly payments any remaining federal student loan debt will be forgiven, tax free. Many of the other debt free programs are taxable when the debt is forgiven.
The government wants the employers to first talk about Public Service Loan Forgiveness (PSLF) benefits with their employees. This is the first step in educating their employees. The next step is helping the employee sign up and submit the Employment Certification PSLF form. This form should be resigned each year or when you change jobs, in order to certify the employment status. It is important for the employee to keep track of their qualifying service and qualifying payments. Your tax return is not enough verification and is the reason for the form. There are other qualification that need to be met to maximize this benefit.
This may or may not yet be an extra benefit at your place of employment. A visit to the human resource office is worth checking into. Should you need further information go to our student loan video library.