March 2025 brought a seismic moment for public service workers pursuing PSLF. On March 7, 2025, President Trump signed an executive order directing the Department of Education to tighten oversight of organizations receiving indirect federal loan forgiveness, specifically mandating a review of employers that might engage in “substantial illegal purposes.”
This order quickly made headlines in The Washington Post and AP News (March 8, 2025), which reported on growing anxiety among nonprofit employees. While the order didn’t immediately change PSLF qualifications, it prompted the DOE to begin drafting regulatory clarifications that would formalize how employer compliance is evaluated.
In town halls held later that month, the Department assured borrowers that existing certified payments wouldn’t be clawed back. Any new rules would apply prospectively, targeting certifications moving forward. However, they also encouraged borrowers to maintain thorough records, including IRS letters proving an employer’s tax-exempt status and detailed job descriptions.
Financial advisors began urging clients in public service roles to recertify employment for 2025 as soon as possible. This anchored additional payments under the current, clearer rules, protecting them from uncertainties tied to how future “substantial illegal purpose” definitions might land.
Community organizations also stepped up, creating resources to help employees document good-faith reliance on their employer’s status at the time of certification. The month ended with a flood of new ECF submissions as public service workers moved swiftly to strengthen their PSLF timelines.