Student Loan Forgiveness and Part-Time Work

Student Loan Forgiveness and Part-Time Work

Student loan debt is certainly a crisis in America. It currently tops over 1.3 trillion dollars. There is more student loan debt than credit card debt and it only seems to be growing. As I mentioned in a previous post the Obama administration has taken steps to try to alleviate this burden somewhat. However, even with a better payment plan hundreds of thousands suffer from high student loan costs and will still be in student debt for years. This post is really dedicated to those people who have high student loan debt, potentially a low-income, and maybe even work part-time, particularly my colleagues who are part-time teachers.

Adjunct Faculty and Student Loan Debt

In America today, most college classes are taught by adjunct faculty. These people are part-time, receive no benefits, and their wages are fairly low. Most adjunct faculty have advanced degrees (e.g. Ph.D.s) and maybe even went back to school with the idea that they would like to become a full-time professor.

Unfortunately, the job market for professors isn’t very good, particularly at the tenure-track level. Only 35% of positions today are considered tenure-track. Most classes are taught by temporary or part-time faculty.

The problem is this. A good number of part-time faculty would like their part-time job to be full-time. However, because of monetary constraints, lack of qualifications, mobility issues, and a whole host of other factors they are only able to achieve part-time status. Yet a good chunk of those faculty work full-time because they teach at multiple places. It is not unusual for a part-time faculty member to teach at 2 or 3 campuses attempting to cobble together a full-time schedule so they can make ends meet. There are a number of stories where part-time faculty have had to resort to food stamps to survive because their pay is so low, they couldn’t get enough classes, or they are burdened with other debt.

You would think that a master’s degree or Ph.D. would guarantee long-term sustainable employment. Unfortunately that is not the case.

To be fair there are many faculty who just want to be part-time. They might teach a class or  two for extra money or want the flexibility of a part-time schedule or this is a second career for them. But a high percentage of adjunct faculty are adjunct not only at one institution, but at others as well.

Many of these faculty members are carrying around with them tens of thousands of dollars in student loan debt. In 2014, Senator Dick Durbin of Illinois introduced a bill to assist adjunct faculty with their student loan debt. Unfortunately, the bill went nowhere and with the current make up of Congress it probably won’t be adopted anytime soon. So what is a part-time faculty member to do?

Answer: Still apply for Student Loan Forgiveness

Public Service Loan Forgiveness and Adjunct Faculty

As readers of this blog will know I am on the public service loan forgiveness program. I do have some trepidation about it because I made those stupid choices, but financially it is the best decision for my family. I am full-time so I easily qualify for PSLF

I have also noted that Mrs. ROB has student loan debt. Unfortunately, Mrs. ROB is a part-time faculty member at two (potentially three) different institutions. However, under the current PSLF regulations she is not eligible for PSLF because she isn’t full-time.

However, there is a loop hole. Because in the eyes of the law she is full-time.

Let me explain.

When Obamacare was rolled out they needed a way to calculate and determine what was considered full-time employment. Under Obamacare rules you need to be employed 30 hours a week to be considered full-time.

They also put in a provision that if you add up two different part-time positions together you can be considered full-time. So if you work 20 hours here and 15 another place, technically for the sake of Obamacare you are full-time.

For adjunct faculty the Treasury Department also provided a ruling that adjunct faculty would be awarded 2 1/4 hour of service for every credit hour that you teach. So if you teach a 3 credit course that counts for 6.75 hours toward the 30 hours needed to be full-time.

Mrs. ROB teaches a total of five classes at two different campuses on a regular basis. She has done this for the past three years. Her five classes add up to 33.75 hours. So she meets the PSLF requirements. YAY!

And the same can be said for other adjunct faculty. You can teach an equivalent of a full-time load and be considered for public student loan forgiveness.

Here’s the Catch

There are some other things that go along with this program that any person who wants student loan forgiveness must meet.

First, you must be on an income-based repayment plan. In an earlier post I talked about the new REPAYE plan for people who have student loan debt. You are NOT eligible for PSLF if you are just paying the standard payments for student loans. If you are not paying the standard payments it probably means one of two things you have a relatively low amount of student loan debt or your income is high enough to cover the payments. Mrs. ROB and I’s loans together make us eligible for an income-based plan. I am not happy about it, but that is the deal.

Second, to be eligible for PSLF you must have a job that qualifies (e.g. you work for a non-profit, are a teacher, police officer, etc). If you work part-time you must work at two part-time jobs that meet the public service criteria. And teaching at a PRIVATE school COUNTS as a public service organization. It is not just public institutions. Most private colleges are non-profit.

Third, you MUST get your human resources people to sign off on your PSLF applications and then you submit them altogether. We ran into a bit of a snafu with one of Mrs. ROB’s institutions, but when she brought in the regulations and they saw it they had no problem signing it.

Fourth, you MUST make 120 payments to have your loans forgiven. That is potentially 10 years of adjunct/part-time work where you cobble things together to be full-time. That is a LONG-time. There is talk of legislation that would make PSLF incremental, but as it stands now you have to do 120 student loan payments to be eligible.

Finally, when you have made your 120 payments and you have had the application approved your loan balance will be forgiven. Normally any debts forgiven is considered taxable income. However, under the rules of PSLF the debt is NON-TAXABLE. Not a bad deal.

The Bottom Line: Adjunct faculty have a hard-time making a living, but they make up the bulk of college faculty today. Many of them are burdened by high student loan debts. Until more specific legislation is passed there is a way to get some kind of debt relief. There are hoops to jump through, but if you put in the time and paperwork it can be done. Two weeks ago we found out that Mrs. ROB’s application was approved for PSLF. Like me, she will have to teach a long-time or try to find full-time work in a public organization to have the loans forgiven, but at least now I can see a light at the end of the tunnel.

 

8 thoughts on “Student Loan Forgiveness and Part-Time Work

    1. Hi Joni,

      Well before I found out that PSLF items are not subject to federal taxes I thought we were going to have to pay a large tax bill. The reason for that is that the IRS considers debt that is forgiven to be taxable income. So I thought, originally, that if we had our student loan debt forgiven that would be added to our adjusted gross income and we would have to pay taxes on it. I, however, have since been corrected and it turns out that PSLF loans that are forgiven are NOT subject to taxes, which is great!!

  1. Do adjuncts have to work 30+ hours during the summer months too, or just during the standard fall/spring academic year?

    1. It depends on the adjunct, but most adjuncts don’t teach during the summer because those courses are often reserved for full-time faculty, although some do. My wife is adjunct and she is teaching a bit during the summer. And how many hours adjuncts put in depends on the number of courses. If they are teaching 4-5 courses they might be spending 12-15 hours in the classroom, but add on at least a couple of hours of course prep for each course, plus grading and meeting with students and they easily can push up to 50 hours per week or more.

  2. I am adjunct faculty in the process of bringing all the information to HR departments. This is the gray area for me and would love to be put in touch with Robin or see a blog about how to detail the hours with Human Resources. They tend to mark hours vs. using this new formula. confusing but persisting in the process. adjunct for 15 years! still working! 🙂 amy

    1. Hi Ag,
      Actually there is a specific formula the treasury department put out a couple of years ago. Each credit is worth an additional 1 1/4 hour. So if you teach three credits is 6.75 hours. For credits it would be 9 hours. So in order for this to work you need to have over 30 hours. However, you can do it from a combination of schools. That should work. It worked for my wife. Let me know if I can help more.

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