In the evolving landscape of student loan repayment and regulatory compliance, it’s crucial for borrowers and non-profit organizations to stay informed about recent developments. This article provides an overview of the latest changes to Income-Driven Repayment (IDR) plans, specifically the Saving on a Valuable Education (SAVE) plan, and highlights important compliance obligations under the Corporate Transparency Act (CTA) for non-profit entities.
Updates on the SAVE Plan
The SAVE plan, introduced to offer more manageable repayment options for federal student loan borrowers, has recently faced significant legal challenges. On February 18, 2025, the 8th Circuit Court of Appeals expanded an injunction against the SAVE plan, leading the Department of Education to suspend applications for all IDR plans, including SAVE and federal Direct consolidation loans. This decision has introduced uncertainty for approximately 8 million borrowers enrolled in these plans, as well as those seeking enrollment. The Department has yet to provide detailed guidance on how this injunction will impact current participants.
In response to the injunction, the Department of Education has placed affected borrowers in a general forbearance, with no payments required until at least December 2025. However, it’s important to note that during this forbearance period, borrowers will not accrue credit toward Public Service Loan Forgiveness (PSLF) or IDR forgiveness. To address this, the Department has a “PSLF Buyback Program,” allowing borrowers to make payments during the forbearance to count toward their forgiveness requirements.
Beneficial Ownership Information Reporting for Non-Profit Organizations
The Corporate Transparency Act (CTA), enacted to combat illicit financial activities, requires entities to disclose their beneficial owners to the Financial Crimes Enforcement Network (FinCEN). While many non-profit organizations are exempt from this reporting requirement, it’s essential to understand the specific criteria:
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Exempt Entities: Non-profits that have obtained tax-exempt status under section 501(c)(3) of the Internal Revenue Code are generally exempt from BOI reporting. This includes most charitable organizations, religious institutions, and private foundations.
- Non-Exempt Entities: Non-profits without 501(c)(3) status, including those awaiting approval or those that have had their status revoked, are required to comply with BOI reporting. It’s crucial for these organizations to file the necessary reports to avoid substantial penalties.
The initial deadline for BOI reporting was January 1, 2025. However, due to ongoing legal challenges, the enforcement of the CTA has been subject to delays. As of February 2025, the Supreme Court has allowed the enforcement of the CTA, but certain injunctions remain in place, making the current status of reporting requirements complex. Non-profit organizations are advised to consult with legal counsel to determine their specific obligations under the CTA.
How We Can Assist
Navigating these developments can be challenging. Our team at Student Aid Experts is dedicated to providing personalized assistance to help you understand and manage your student loan obligations effectively. We offer:
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Consultation Services: Personalized guidance to help you understand how these changes impact your specific situation.
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Application Assistance: Support in exploring alternative repayment plans or consolidation options that may be available.
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Compliance Guidance for Non-Profits: Assistance in determining your organization’s reporting requirements under the CTA and ensuring timely and accurate filings.
For more information or to schedule a discovery call today https://calendly.com/studentaidexperts-info/discoverycall
Staying informed and proactive is essential in adapting to these changes. Our team is here to support you every step of the way.