Trump’s Latest Moves Threaten Student Loan Forgiveness For More Public Service Borrowers

 Trump’s Latest Moves Threaten Student Loan Forgiveness For More Public Service Borrowers

The Trump administration took new steps this week that could jeopardize student loan forgiveness for thousands of Americans based on their public service careers. And this is just the latest in a series of actions that threatens to undermine a bedrock of the federal student loan relief system.

Public Service Loan Forgiveness, or PSLF, was signed into law in 2007 by President George W. Bush. The program incentivizes borrowers to work in traditionally lower-paying fields in the nonprofit or government sectors. Those who repay their federal student loans while working in qualifying, full-time employment for at least 10 years (while meeting other program criteria) are entitled to receive loan forgiveness for any remaining balance once they have fulfilled their service obligation. Qualifying employers include any tax-exempt 501(c)(3) nonprofit organization, as well as public or government organizations at the federal, state, tribal, or local level. More than a million borrowers have had their student loans discharged under the program to date.

But President Donals Trump issued new directives last month targeting PSLF. And this week, the administration took additional steps that threaten the program’s future by targeting individual nonprofit institutions. And this may only be the beginning.
Student Loan Forgiveness Threatened By Removal Of Employer Nonprofit Status
This week, President Donald Trump suggested that the IRS should revoke the nonprofit tax-exempt status of Harvard University. The next day, news reports indicated that the IRS it taking potential steps to do just that.

The move followed Harvard’s rejection of conditions proposed by the Trump administration regarding the university’s internal policies for hiring staff, admitting students, creating its curriculum, and handling student activism. Harvard responded by letter to the administration rejecting the proposed conditions, arguing that the efforts to exert control over a private university were unconstitutional and an improper government overreach.