IDR Plan Court Actions: Impact on Borrowers

If your recertification date was on or before March 17, 2025, you were due to recertify on or before Feb. 20, 2025.

Please note that servicers have started updating recertification dates, but the process will take time.

Log in to view your IDR recertification date

If your recertification date was on or after March 18, 2025, you were due to recertify on or after Feb. 21, 2025.

You are in a general forbearance, unless you obtained a different status (for example, deferment), because your loan servicer is not currently able to bill you at an amount required by the court injunction. You will be in this forbearance until servicers are able to accurately calculate monthly payment amounts or the court reaches a decision on the availability of the SAVE Plan. Borrowers will be informed of any further change to this litigation-related forbearance.

Under this general forbearance,

Borrowers should be aware that forgiveness as a feature of the SAVE, PAYE, and ICR Plans is currently paused. Borrowers can have their loans forgiven if they are enrolled in the IBR Plan. Payments on PAYE, SAVE, and ICR are counted toward IBR Plan forgiveness if the borrower enrolls in the IBR Plan.

If you believe that you are close to qualifying for forgiveness of your loan under PSLF, please see additional information below.

The conditions of forbearance differ based on the borrower’s status.

If you are in the SAVE forbearance: As described above, ED has placed borrowers currently enrolled in the SAVE Plan (previously known as the Revised Pay As You Earn, or REPAYE, Plan) into a general forbearance because their servicers are not currently able to bill them at the amount required by a recent court order. Interest will begin accruing under this forbearance on Aug. 1, 2025. This forbearance will last until the legal situation changes or servicers are able to send bills to borrowers at the appropriate monthly amount. Furthermore, time spent in this general forbearance will not count for PSLF or IDR forgiveness.

If you are in a processing forbearance: Servicers may place borrowers into a different forbearance category, known as processing forbearance, if the servicers need additional time to process those borrowers’ applications to enroll in IDR, recalculate their payments on an IDR plan, or recertify their incomes for their IDR plan. Interest will accrue while a borrower is in processing forbearance. In contrast to the general forbearance for borrowers enrolled in SAVE, time spent in the processing forbearance (up to 60 days) is eligible for PSLF credit. A processing forbearance will last no longer than 60 days, at which point a borrower may be placed into the general forbearance under the terms described for that status.

Forgiveness as a feature of the SAVE, PAYE, and ICR Plans is currently paused, because those plans were not created by Congress.

Generally, ED can and will still process loan forgiveness for the IBR Plan, which was separately enacted by Congress. Payments on the PAYE, SAVE, and ICR Plans are counted toward IBR Plan forgiveness if the borrower enrolls in IBR. Currently, IBR forgiveness is paused while our systems are updated to accurately count months not affected by the court's injunction. IBR forgiveness will resume once those updates are completed.

Although the general forbearance for borrowers enrolled in SAVE does not count toward PSLF, there are currently two ways borrowers may be able to receive PSLF credit. Borrowers should review these two options closely before taking any action.

Enroll in a different PSLF-eligible repayment plan

Borrowers can apply to enroll in a different PSLF-eligible repayment plan. We encourage borrowers to look at the specific terms of each plan to make the best choice for their individual situation. Different IDR plans may require different monthly payments, and—in the case of the IBR Plan—borrowers who later enroll in a different repayment plan may face interest capitalization (where unpaid interest is added to the principal balance). However, payments made under these IDR plans will count toward forgiveness under IDR and PSLF.

Buy Back Credit

Some borrowers may be eligible to “buy back” months of PSLF credit for time spent in forbearance as a result of the court’s injunction. Borrowers with 120 months of eligible employment can buy back (make payments to cover) past months that were not originally counted as qualifying payments because the borrower was in an ineligible deferment or forbearance status. In the future, borrowers will be able to buy back months even if they do not have 120 months of eligible employment. Borrowers must submit a buyback request and make an extra payment of at least as much as what they would have owed under an income-driven repayment (IDR) plan during the months they are trying to buy back.

You can buy back these months only if

This is a new process that ED began making available fall 2023. Learn about eligibility and how to buy back months.

Note: Borrowers who have consolidation loans can buy back months only on the current consolidation loan. These borrowers can’t buy back months from the loans included in the consolidation loan or for any period prior to the first disbursement date of a consolidation loan.

Although the court action is primarily about the SAVE Plan, there were some changes made to how ED calculates monthly payment amounts for the IBR, ICR, and PAYE Plans. Additionally, the court action affects which deferments and forbearances can count as progress toward IDR forgiveness.

Due to the court actions, the only IDR plan for which the interest subsidy can be applied is the IBR Plan. It is applied only to subsidized loans in the first three years of payments and covers 100% of the unpaid interest each month.

If your loans are discharged on or after Jan. 1, 2021, and before Jan. 1, 2026, you won’t get taxed by the federal government, but your state government might tax you.

Any debt forgiven as a result of IDR forgiveness won’t create a federal tax liability for you. The American Rescue Plan Act included a provision temporarily modifying the tax treatment of discharged student loan debt. Specifically, the law excludes from gross income qualifying student loans that are discharged on or after Jan. 1, 2021, and before Jan. 1, 2026. During this period, the amounts of forgiven student loan debt won’t be subject to federal taxation.

However, the amount forgiven could be taxable in some states. We will notify you if we plan to discharge your loans as a result of IDR forgiveness and will provide a 30-day period to opt out of automatic forgiveness.

There is no process for borrowers to speed up or escalate their forgiveness timeline.