IBR Loan Forgiveness: 2025 Updates & How to Qualify

In 2025, the U.S. Department of Education paused income-driven repayment plan discharges while fixing payment-count errors tied to litigation over the SAVE plan. At the end of September, the Department began forgiving loans for student loan borrowers with more than 300 qualifying payments and enrolled in the Income-Based Repayment Plan — the first approvals under this administration.

The Education Department says it paused IBR plan discharges in mid-2025 to “update systems” and “rebuild payment-count logic” affected by legal challenges to the SAVE plan. The injunction blocking SAVE and other IDR plans forced the agency to separate those programs inside its own software before it could process more student loan forgiveness discharges.

Department officials also told the court they needed time to prevent payment-count errors, rebuild tracking tools, and manage the impact of widespread staff layoffs. The Ombudsman’s office — the group that usually fixes bad data — was cut in half earlier this year, and a government shutdown furloughed most remaining staff just as the new system was coming online.

Advocates and attorneys aren’t sure how much of the pause was technical and how much was legal strategy. The American Federation of Teachers amended its lawsuit in September, arguing the Department had no legal basis to block IBR forgiveness while those updates were underway. Days later, borrowers with 300-plus payments began receiving approval emails.

So yes — the Department says this was a systems fix. But for borrowers who watched their payment counts disappear, it felt like another delay in a twenty-five-year wait.

You meet eligibility for IBR student loan forgiveness if the Education Department owns your student loans, you’ve repaid for the required number of years, and you’re in the correct repayment plan when forgiveness is processed.

Do my loans qualify?

• Loans owned by the Education Department: This category includes Direct Loans and any FFEL loans that ED has purchased or now holds. These federal student loans qualify for IBR forgiveness and are automatically credited under the [one-time Income-Driven Repayment (IDR) adjustment]…

• Privately held federal loans: These are Federal Family Education Loan (FFEL) Program loans still owned by private lenders, not by the government. They can qualify under FFEL-IBR rules, but they did not receive the retroactive IDR adjustment unless consolidated by June 30, 2024. If you consolidate these student loans now, you’ll lose any progress you’ve already made toward IBR forgiveness.

• Parent PLUS borrowers: Parent PLUS loan borrowers can now qualify for IBR forgiveness even if they were previously limited to the Income-Contingent Repayment (ICR) plan. After Congress passed the One Big Beautiful Bill Act (OBBBA), the rule that restricted Parent PLUS borrowers to a single income-driven plan was removed. Borrowers can now switch into ICR without relying on the old double-consolidation loophole.

The next steps depend on whether you’ve received an approval email from the Education Department or are still waiting.

If You Got the Email from the Education Department

That notice means you’ve reached the forgiveness threshold and are now in line for review. The email includes a short opt-out window. If you don’t opt out, the Education Department will instruct your loan servicer to begin the discharge process once system updates are complete. The message confirms your eligibility, but the department has not yet announced when discharges will post.

If You Haven’t Gotten the Email Yet

If you believe you qualify but haven’t heard anything, wait a bit, then check with your servicer. Use the back-door tracker to confirm your qualifying payment count. If your loans show as “null” or the numbers look off, take screenshots and report it to your servicer.

If the stall continues, escalate by contacting the Federal Student Aid Ombudsman or your Member of Congress. These offices can request an update or review, though responses may be delayed during the ongoing government shutdown, when most Education Department staff are furloughed.

Your path to forgiveness depends on who owns your loans — the Education Department or a private lender.

If Your Loans Are Owned by the Education Department

Keep making your student loan payments. They still count toward forgiveness if you’re in Pay As You Earn or the Income-Contingent Repayment — these income-driven repayment plans qualify. Borrowers in the SAVE plan are currently in administrative forbearance due to ongoing litigation, so those months do not count.

For now, stay in the plan that’s most affordable. When you reach the 20- or 25-year mark, you’ll need to switch into IBR so the Education Department can process your IBR discharge. Until you do, cancellation won’t be granted.

If Your Loans Are Privately Held Federal Loans

These are FFEL Program loans still owned by private lenders — often serviced by companies like Sloan Servicing, American Education Services (AES), or those that moved from Navient to MOHELA over the past few years.

The one-time IDR adjustment didn’t apply to these loans. Only monthly payments made under the income-based repayment (IBR) plan count toward forgiveness. Payments made under other student loan repayment plans like standard, graduated, or extended plans do not qualify, nor do periods spent in deferment or forbearance.

Before the Door Closes in 2028

Under current rules, borrowers who want IBR forgiveness must enroll in the IBR plan before June 30, 2028. After that, new borrowers and anyone not already in IBR will move into the Repayment Assistance Plan (RAP) instead. RAP adds five more years to the forgiveness timeline — from 25 to 30 years — even though it includes some added benefits like interest waivers.

If you’re still working toward IBR forgiveness, that deadline is the one that matters.

Some borrowers are seeing their payment counts disappear, reset to zero, or show as “null” after years of repayment — most often due to incomplete data transfers from legacy servicers like ACS and Conduent during the Department’s system migration.

Unfortunately, there are no quick fixes. The Education Department hasn’t created a formal reconsideration process, which means corrections depend entirely on your ability to document your history and escalate through the right channels.

Learn More: How to Fix Your IBR Loan Forgiveness Payment Count

You will not owe taxes if your forgiveness is completed in 2025.

Under the American Rescue Plan Act passed during the Biden administration, any federal student loan balance forgiven through that year is excluded from federal income tax.

If your IBR discharge doesn’t post until 2026, the forgiven remaining balance could be treated as taxable income under current law. For borrowers with large balances, that bill could be significant.

Some advocates believe the approval notice or “identifiable event” issued in 2025 could lock in tax-free status, but that theory hasn’t been tested. Neither the Education Department nor the IRS has said whether those notices will count.

Until clear guidance is issued, the safer assumption is that the forgiveness must actually post in 2025 to avoid federal taxes. Advocates are pressing the courts to push the Education Department to complete discharges before the deadline.

Learn More: How the Insolvency Exclusion Works for Student Loans