Trump Administration's PSLF Rule Narrowly Defines Public Service to Block Forgiveness

Public servants employed by disqualified employers will be ineligible for student loan forgiveness after 10 years of qualifying payments. This outcome is the result of a rule finalized at the end of 2025 by the Trump administration to redefine 'public service' for the Public Service Loan Forgiveness (PSLF) program. The rule bars employers that engage in 'substantial illegal activity,' which the administration identifies as including gender-affirming care or harboring illegal immigrants. If the Department of Education determines an employer employer engaged in illegal activity, the employer is notified and given an opportunity to rebut the findings. If the employer is disqualified, they can reapply for eligibility within 10 years or enter a 'corrective action plan' in cooperation with the department. Democratic lawmakers, led by Sen. Tim Kaine and Rep. Joe Courtney, have announced a resolution under the Congressional Review Act to block the rule, which is set to take effect on July 1.