I was hired at a non-profit on 9/30/2013 but was laid off on 5/14/2015 due to no fault of my own. While with my former employer, I was enrolled in PSLF and had an IRB payment plan of $0/ month due to my low salary. I only submitted one employer certification form while working there on 3/11/2014 and therefore received PSLF credit for those months (9/30/13 through 3/11/14). I am preparing to send another employment certification form to my former employer to get PSLF credit for my remaining time there (3/12/14 through 5/14/15). 

Here are my questions:

1. After I was laid off, I received 3 additional paychecks. This money came from 3 weeks paid vacation I had left over and 3 weeks of severance pay. I see that the employment certification form says that qualifying full-time employment includes “vacation, leave time, or any leave taken under the Family Medical Leave Act of 1993.” I should get credit for those 3 weeks of vacation, correct? What about the 3 weeks of severance pay?

2. I am currently on unemployment. I was thinking about submitting that change in income to Dept of Education and applying for deferment. Is there any benefit/harm to doing deferment as opposed to remaining on the $0/ month IRB plan?

THANK YOU!

1. If you look at the PSLF form, the only info the HR office fills out is when you began, when you ended, and average number of hours per week. It’s up to the person in HR to come up with that figure, and usually most places will just put 40/wk regardless of vacation/sick pay.

2. If you are already at $0/month with IBR, there is no need to submit a change in income (unless your annual certification is up). You aren’t required to submit one every time your income changes. Also, if you are at $0/month, why would you want to take a deferment? The only benefit to a deferment is that your subsidized loans’ interest will be paid for by the govt. The downside is that you have a limit to the number of deferments you can take for the life of the loan(3 years I believe). If you are thinking of getting a job outside the public sector that pays a lot better and want to pay off the loans, then a deferment would make sense… but they are limited…

Also, taking deferments will cause interest to capitalize at the end of the deferment period…so you will be paying interest on the interest…

hart47 - 21 August 2015 08:51 AM

1. If you look at the PSLF form, the only info the HR office fills out is when you began, when you ended, and average number of hours per week. It’s up to the person in HR to come up with that figure, and usually most places will just put 40/wk regardless of vacation/sick pay.

2. If you are already at $0/month with IBR, there is no need to submit a change in income (unless your annual certification is up). You aren’t required to submit one every time your income changes. Also, if you are at $0/month, why would you want to take a deferment? The only benefit to a deferment is that your subsidized loans’ interest will be paid for by the govt. The downside is that you have a limit to the number of deferments you can take for the life of the loan(3 years I believe). If you are thinking of getting a job outside the public sector that pays a lot better and want to pay off the loans, then a deferment would make sense… but they are limited…

Thanks for the advice! In terms of #1, I was more concerned about the “End of Employment” date rather than the hours per week. I was working full-time (40 hrs), so that’s not an issue. My question is whether or not HR will write my last day of employment (5/14/15), last day of employment plus 3 weeks vacation time (6/4/15), or last day of employment plus 3 weeks vacation plus 3 weeks severance (6/25/15). Obviously I’d prefer 6/25, though I suppose it’s up to HR.

Point taken on #2. It makes a lot of sense to wait to report any changes in income until I’m require to do so. Thanks!