A federal student loan forgiveness program allows employees of qualifying nonprofit organizations to receive taxpayer-backed debt relief after meeting payment requirements, including workers at groups whose missions may be disputed by many taxpayers.
By yourNEWS Media Newsroom
U.S. taxpayers are covering student loan debt for workers employed by qualifying nonprofit organizations, including some groups whose missions or activities may not fit many taxpayers’ understanding of public service, according to a report by Just the News.
The debt relief comes through the Public Service Loan Forgiveness program, known as PSLF, which allows eligible borrowers to have remaining federal student loan balances forgiven after making 120 qualifying payments while working for an approved employer.
The program applies to workers employed by U.S. federal, state, local or tribal governments, the military and qualifying nonprofit organizations. Under the program’s rules, eligibility is tied to the borrower’s employer rather than the employee’s specific role.
“Qualifying employment for PSLF isn’t about the specific job that you do for your employer—it’s about who you work for,” the PSLF website says.
That standard has made the program available to employees across a broad range of nonprofit organizations with tax-exempt status, including groups designated under Section 501(c)(3). While many taxpayers may support student loan forgiveness for people working in the military, public safety, health care, disability services or early childhood education as forms of public service, the same program can also apply to workers at organizations with more politically divisive missions.
Among the organizations whose employees may qualify is the States United Democracy Center, a group that Just the News previously reported has worked with Democratic attorneys general across the country on prosecutions involving supporters of President Donald Trump.
Employees of Dompet Dhuafa USA are also eligible for the federal loan forgiveness program. The group’s parent organization has apparent ties to designated terrorist groups, according to a separate Just the News report, which said the organization openly referred to Hamas as “freedom fighters” immediately after the Oct. 7, 2023, atrocities in Israel.
The PSLF website excludes for-profit organizations, labor unions and “partisan political organizations” from eligibility. However, the partisan restriction applies to groups formally affiliated with a political party or created to support a political candidate or party policies, which are typically classified by the Internal Revenue Service as 501(c)(4) organizations.
That distinction means employees of certain ideological organizations can still qualify if the employer holds 501(c)(3) status. Employees at the Center for American Progress, a left-leaning organization with 501(c)(3) status, can benefit from the program. Conservative workers at the right-leaning Heritage Foundation can also qualify because the foundation is registered as a 501(c)(3) research and educational think tank, even though it operates alongside Heritage Action for America, its 501(c)(4) social welfare and political advocacy affiliate.
Congress created PSLF in 2007, and President George W. Bush signed it into law. The first borrowers became eligible for forgiveness in 2017, but strict rules resulted in nearly all applicants being denied debt relief during the program’s early years.
The Biden-Harris administration later issued temporary waivers that allowed borrowers to receive credit for loan payments that normally would not have qualified. In December 2024, the Department of Education announced that nearly 750,000 borrowers had received debt relief through PSLF, NPR reported.
The Trump administration’s Department of Education moved in late 2025 to tighten the definition of a qualifying employer. The department limited eligibility by excluding organizations “that engage in unlawful activities such that they have a substantial illegal purpose, including supporting terrorism and aiding and abetting illegal immigration.”
Under Secretary of Education Nicholas Kent said the change was intended to prevent federal benefits from supporting unlawful conduct.
“Taxpayer funds should never directly or indirectly subsidize illegal activity. The Public Service Loan Forgiveness program was meant to support Americans who dedicate their careers to public service – not to subsidize organizations that violate the law, whether by harboring illegal immigrants or performing prohibited medical procedures that attempt to transition children away from their biological sex,” Kent said when the rule was announced.
“With this new rule, the Trump Administration is refocusing the PSLF program to ensure federal benefits go to our Nation’s teachers, first responders, and civil servants who tirelessly serve their communities.”
Despite the rule change, an investigation of the PSLF website found that nearly any 501(c)(3) organization continues to qualify, leaving taxpayers responsible for loan forgiveness tied to a wide range of nonprofit employment.
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