Education Department Drops PSLF Challenge: What Student Loan Borrowers Should Check Now

As of October 24, 2026, the federal government has dropped its appeals defending a 2025 rule that could have disqualified certain government and nonprofit employers from Public Service Loan Forgiveness (PSLF). The rule was vacated before it took effect, and the appeals are now over. For borrowers, that is a meaningful legal update—but it does not automatically erase a balance, certify a job, or add missing payments to an account. The useful next step is to check your own StudentAid.gov records and make sure your employer, loans, repayment plan, and payment count are documented.

What the government dropped

The Department of Education’s 2025 PSLF rule would have allowed the Secretary of Education to disqualify a government or nonprofit employer if the department found the organization had a “substantial illegal purpose.” A federal judge vacated the rule on June 30, 2026, one day before it was scheduled to take effect. The court concluded that the rule exceeded the department’s authority and violated federal law, including the First Amendment.

The government appealed decisions in three cases. The Justice Department and plaintiffs filed joint stipulations ending two appeals on October 21; the parties in the Massachusetts-led case filed a stipulation on October 22. The California Attorney General’s announcement links to the final court filing, while the nonprofit plaintiffs’ counsel and Public Citizen reported the two earlier dismissals.

The Department also told the Federal Register in September that it was removing the employer attestation from the PSLF form to comply with the court order. That notice said no other changes were being made to the form at that time. In practical terms, the disqualification rule is not in force; the dropped appeals did not create a new forgiveness benefit or waive the existing PSLF requirements.

What PSLF still requires

PSLF can forgive the remaining balance on eligible federal Direct Loans after a borrower makes 120 qualifying monthly payments while working full-time for a qualifying public-service employer. The payments do not have to be consecutive. Qualifying employment depends on the employer and certified work period, not simply a job title. For most borrowers, full-time means an average of at least 30 hours per week, subject to the program’s rules for multiple part-time qualifying jobs.

Because the program depends on more than the employer’s status, do not treat the headlines as confirmation that you qualify. Check each loan and each month of employment and repayment in your account.

Borrower checklist: what to check now

1. Review your PSLF account history. Sign in at StudentAid.gov. In My Activity, check whether each submitted form is completed, whether you and your employer signed it, and whether the certified employment dates are correct. In My Aid, open the PSLF payment summary for each loan. Save copies of forms, notices, and employment records. Federal Student Aid explains how to track forms and counts in its PSLF progress guide.
2. Confirm the employer and its identifying information. Use the PSLF Employer Search and check the employer’s correct Employer Identification Number (EIN), usually shown in box b of your W-2. If you changed jobs, changed work hours, or have not certified employment recently, submit a PSLF form through the Help Tool and follow up with the authorized official who signs it. Federal Student Aid recommends certifying annually and when you change employers. A qualifying employer—not a particular title like “teacher” or “caseworker”—is the key test.
3. Check the loan type and status before consolidating. PSLF applies to eligible Direct Loans that are not in default. Federal Family Education Loan (FFEL) and Perkins loans may require consolidation into a Direct Consolidation Loan; private education loans do not qualify. Consolidation can change how past payment credit is calculated. Federal Student Aid says that for consolidations made on or after September 1, 2024, qualifying payments on included Direct Loans are credited using a weighted average, while payments on other loan types are not included in that calculation. Review the current PSLF questions and answers before deciding whether consolidation fits your situation.
4. Verify that your repayment plan counts for your loans. The rules changed on July 1, 2026. Federal Student Aid’s current guidance distinguishes loans disbursed before that date from loans disbursed on or after it; it also states that payments under the Tiered Standard Plan do not count for PSLF. If you received a new Direct Loan or consolidated on or after July 1, check your repayment plan in StudentAid.gov before assuming payments qualify. Compare eligible options with the official PSLF requirements and Federal Student Aid’s 2026 program updates; do not switch plans solely because of a headline.
5. If your count is near 120, check the next step with Federal Student Aid. The account must show 120 qualifying payments and the required employment before the remaining balance can be discharged. Submit the official PSLF form when eligible and keep making payments while the application is processed unless your account is officially placed in a qualifying forbearance. A dismissed appeal is not an approval notice.

Mistakes to avoid

• Do not stop payments, leave a qualifying job, refinance federal loans into private loans, or consolidate solely because the rule challenge ended.
• Do not assume all 120 payments are already credited. Check the payment summary loan by loan and save proof if a count looks wrong.
• Do not pay a company that promises instant PSLF approval or asks for your StudentAid.gov password. The official application and federal loan-servicer help are free; use the government’s student-loan scam guidance if an offer seems suspicious.

The appeal withdrawals preserve the court rulings against this particular employer rule. They do not lock PSLF rules against future changes, and they do not replace an individual review of your loans and records. For a concrete status, rely on your StudentAid.gov account, the current PSLF Help Tool, and written notices from your federal loan servicer.