IBR student loan forgiveness has been paused

The Biden era rewrote the rules of student loan repayment, then the courts and a new administration rewrote them again. The latest twist is narrow but consequential. The U.S. Department of Education has temporarily paused time-based discharges for borrowers in Income-Based Repayment, better known as IBR. The agency says it must update systems to comply with court orders that blocked key parts of another repayment plan, SAVE, and that it will restart IBR discharges once it can certify correct payment counts. For borrowers who have spent decades making qualifying payments, months can feel like a lifetime. Understanding what changed, why it changed, and what to do next can help you protect your progress and avoid costly mistakes while the pause persists.

IBR is one of the government’s income-driven repayment options. It caps payments at a percentage of discretionary income and wipes away remaining balances after a set number of years. For “new borrowers” who first borrowed on or after July 1, 2014, payments are generally 10 percent of discretionary income and forgiveness arrives after 20 years of qualifying payments. For others with older loans, payments are generally 15 percent and forgiveness arrives after 25 years. That split is one reason timelines differ so much across households, and it explains why some borrowers are approaching 25-year forgiveness now while others have five to ten years to go.

The reason IBR forgiveness is paused is not that IBR itself was struck down. In February 2025, the Eighth Circuit Court of Appeals upheld an injunction blocking the SAVE plan, concluding the Department overreached in how it structured that program’s relief. That decision reverberated across the broader income-driven ecosystem. The Department has said that to comply with the ruling and related orders, it must adjust how it counts certain deferment and forbearance periods before it can finalize IBR discharges again. This is why the pause is framed as an accounting and systems update problem rather than a repudiation of IBR’s underlying statute.

Officials have publicly stated that IBR discharges will resume once the Department is able to establish the correct payment count. If a borrower makes payments after the date they should have qualified for cancellation, those overpayments are supposed to be refunded when discharges restart. Those assurances matter for households deciding whether to keep paying while they wait.

The scale of the pause is not small. Roughly two million borrowers use IBR today, and many of them rely on the promise that time in repayment will eventually erase remaining balances. While far from all of those borrowers are on the cusp of discharge, a meaningful minority are, particularly those who started in ICR years ago and later switched to IBR. The pause hits this group first.

The legal backdrop matters for another reason. The SAVE injunction did more than freeze a single plan. It upended how the Department credits past time toward forgiveness, especially for periods that the SAVE rule would have counted differently. That created reconciliation work for servicers and the Department’s systems. At the same time, the administration announced that interest will begin accruing again for borrowers who had been parked in SAVE-related forbearance, starting August 1, 2025. If your loans were in that bucket, your balance may begin growing again absent a switch to a plan that keeps your payment active.

Lawmakers have noticed the gap between the Department’s intent and borrowers’ lived experience. On August 18, 2025, Sen. Bernie Sanders and several colleagues sent a letter to Education Secretary Linda McMahon urging the Department to resume IBR discharges and to explain why forgiveness was halted without prior notice to Congress or affected borrowers. Their argument is straightforward. If IBR forgiveness is legally mandated after 20 or 25 years of qualifying payments, then a systems change should not be allowed to turn a statutory right into an indefinite wait. The letter underscores the political pressure to restore normal processing.

For borrowers, the most pressing questions are practical. If you expected your balance to be discharged soon, should you keep paying. The safest course is to continue making on-time payments until your servicer confirms the discharge. That protects your credit and avoids delinquency, and any payments made after you reached your eligibility date should be refundable once the Department resumes discharges. If you stop paying on your own, you introduce late marks and potential fees that can take time to unwind. It can be tempting to pause out of frustration, but a small number of additional payments now is preferable to a damaged payment history that lingers for years.

It is also important to monitor your official payment count. For many borrowers, the student aid dashboard temporarily hides IDR counts while systems are updated. That can be unsettling, but it is consistent with the Department’s public guidance on court-related changes. Keep snapshots or downloads of your prior counts if you have them, and document every communication with your servicer. These records make it easier to challenge errors later and to claim refunds for any overpayments.

If you are not close to discharge, the pause may be emotionally aggravating but less financially disruptive. Remember the timelines. IBR launched in 2009, and older borrowers tied to the 25-year clock will often reach forgiveness in 2034 at the earliest, while newer borrowers on the 20-year track have a longer runway. What you do in the meantime still matters. Staying enrolled in IBR, recertifying income on time, and keeping your account in good standing protect the very credits you are counting on. Missing recertification can trigger payment spikes that nobody wants.

Households working in public service should separate two distinct tracks in their minds. Public Service Loan Forgiveness remains a different benefit with its own rules. The legal fights over SAVE and the systems work behind IBR do not automatically erase PSLF eligibility, though operational slowdowns have affected processing across the system. If you are pursuing PSLF, continue submitting employment certifications, track your counts, and use official channels rather than third-party firms that promise faster outcomes for a fee. Aligning your file with what PSLF requires will position you to move forward once processing backlogs improve.

One more pocketbook issue deserves attention. Federal tax treatment of cancelled student debt is favorable through December 31, 2025. Under the American Rescue Plan Act, most federal student loan forgiveness is excluded from federal taxable income for discharges that occur in 2021 through 2025. Unless Congress acts, that exclusion expires in 2026, which means borrowers who reach time-based IDR forgiveness after that date could again face an income tax bill on the cancelled amount. State tax rules vary and can differ from federal rules. If you are close to forgiveness and believe your discharge will land this calendar year, the tax timing is favorable. If your timeline extends into 2026 and beyond, start planning now for potential taxes on the forgiven balance so that a long-awaited milestone does not morph into an unpleasant surprise at filing time.

The larger policy landscape is shifting too. Congress passed a sweeping student loan package on July 4 that restructures repayment for future borrowers and phases out several income-driven plans over time. Details continue to roll out, but for today’s IBR borrowers the key point is continuity. If you already qualify for IBR, you can stay in IBR and keep earning credit toward the plan’s existing forgiveness rules unless and until federal law explicitly says otherwise. Simplification for tomorrow’s borrowers should not erase commitments made to people who have been paying under today’s rules for years.

Here is how to translate all of this into action. First, make the next payment on time unless your servicer or the Department has confirmed your discharge in writing. The promised refund of overpayments makes continued payments a safer hedge. Second, verify your contact details, turn on alerts, and watch for official updates in your StudentAid.gov account since that is where any new count displays or discharge notices will appear once systems work is complete. Third, keep a personal file that includes your original promissory notes, your repayment plan history, prior count screenshots if you have them, and your last two years of income documentation. Those records are your best defense against administrative error and your quickest path to a clean refund if you paid past your eligibility date. Fourth, if you work in public service, continue the PSLF routine of annual employer certification and watch for updates about the PSLF Buyback processing backlog, which remains a separate queue from IBR discharges.

Finally, keep perspective. A pause is not a revocation. IBR is rooted in statute, and Congress designed it to deliver a clean end to repayment after 20 or 25 years of qualifying payments. Courts have constrained SAVE, which forced the Department to check its math on how months are counted, but the agency has not disowned IBR forgiveness. Borrower advocates and lawmakers are pressing for answers and timelines, which raises the odds that the logjam breaks sooner rather than later. Until then, your task is to protect your credit, preserve your eligibility, and prepare for taxes if your forgiveness date lies on the far side of 2025. That is not the finish line anyone hoped for, but it keeps you pointed toward the same destination that drew you into IBR years ago.

Important note, updated August 21, 2025: The Department’s public guidance states that IBR forgiveness will resume once correct payment counts are established, and that overpayments made after a borrower’s eligibility date will be refunded. Keep an eye on the court-actions page at StudentAid.gov for the status of that systems work, and make sure your servicer has your current email and mailing address so you do not miss the notice that finally closes your account.