The federal government doesn’t have a specific chiropractic student loan forgiveness program. For years, the American Chiropractic Association has worked to gain access to the National Health Service Corps’s loan repayment program for its members. But those please have gone nowhere.
Despite the lack of specific relief options, chiropractors can reduce or eliminate their debt by participating in one of the three programs available to all federal student loan borrowers.
Income-Driven Repayment Plan Forgiveness
Income-driven repayment plans provide a safety net for federal student loan borrowers who can’t keep up with their loan payments on a standard 10-year plan. Plus, they come with an added benefit that no other type of repayment plan does: eventual forgiveness.
Borrowers will have their balance wiped out after making payments for 20+ years.
Typically, the loan amount forgiven is considered taxable income. But that changed with the March 2021 American Rescue Plan, which made forgiven debt tax-free retroactive to December 2020 through the end of 2025.
President Biden included a provision in his budget proposal in March to make that change permanent.
The Education Department is reviewing borrowers’ accounts to increase their payment count toward IDR forgiveness by crediting them for payments made under any plan and instances where their accounts were in long-term forbearances and deferments. It’s doing this partly to make up for problems with forbearance steering and tracking borrowers’ progress towards income-based repayment forgiveness.
The department estimates it’ll be done with this one-time waiver around the beginning of 2023.
Learn More: IDR Waiver Student Loans
Public Service Loan Forgiveness
Chiropractors who work full-time for the government or a nonprofit healthcare provider for 10 years can have their entire federal student loan balance wiped out tax-free. And for a limited time, the Education Department is allowing anyone who worked in public service after Oct. 1, 2007, to get credit towards PSLF even if they had the wrong types of loans, made payments under the wrong plan, been in forbearance, or deferment for years, or never certified their employment previously. Read more about the PSLF Waiver.
Related: PSLF Eligible vs PSLF Qualifying Payments
Unfortunately, many chiropractic college graduates end up working in for-profit, private practices rather than public service and thus miss out on PSLF.
Some chiropractors have attempted to force their way into the PSLF Program in recent years by converting their private chiropractic practice into a nonprofit one. There’s no express rule against it, but there are two major obstacles.
After you overcome those two hurdles, you should be eligible for PSLF as long as you make your monthly payments under an IDR plan like IBR or REPAYE. The Education Department will make the final decision on your eligibility.
$10-20k Debt Cancellation
President Biden announced last month that he would reduce borrowers’ student loan debt by $10 thousand if they didn’t receive a Pell Grant, a type of financial aid available to low-income undergraduate students, and by $20 thousand if they did. Americans earning less than $125 thousand or married couples earning less than $250 thousand are eligible for the relief.
Private student loans aren’t eligible for cancellation, but Parent PLUS Loans and Perkins Loans are.
The Education Department will determine your eligibility for this benefit based on the adjusted gross income on your tax return for 2020 or 2021, whichever is lower. Some people will have the forgiveness automatically applied to their accounts. Others will need to apply when the application is made available.
Learn More: $20k student loan forgiveness.