DIVISION OF STUDENT FINANCIAL AID

Tax-Exempt Organization Volunteer Deferment

Intended to cover full-time paid volunteer service with a tax-exempt organization that the U.S. Department of Education has determined to be comparable to service as a Peace Corps or ACTION volunteer.

• Available to a borrower only if he or she has an outstanding FFELP loan that was first disbursed before July 1, 1993, or a PLUS loan first disbursed before August 15, 1983.

Eligibility Criteria:To qualify for the Tax-Exempt Organization Volunteer deferment, a borrower must request it and provide the lender with a statement from an official of the volunteer program certifying:

• That the borrower has agreed to serve as a volunteer on a full-time basis for at least one year.
• The date on which the borrower's service began.
• The date on which the borrower's service is expected to end.
• That the borrower serves as a volunteer in an organization that is exempt from taxation under Section 501(c)(3) of the Internal Revenue Code of 1986.
• That the borrower provides service to low-income persons and their communities to assist them in eliminating poverty and poverty-related human, social, and environmental conditions.
• That the borrower's compensation--including a subsistence allowance, necessary travel expenses, and stipends--does not exceed the federal minimum wage, except that the tax-exempt organization may provide health, retirement, and other fringe benefits to the volunteer that are substantially equivalent to the benefits offered to other employees of the organization.
• That the borrower, as part of his or her duties, does not give religious instruction, conduct worship services, engage in religious proselytizing, or engage in fundraising to support religious activities.

Deferment Documentation: If the borrower requests a Tax-Exempt Organization Volunteer deferment, the lender should forward to the borrower the following common deferment form: Public Service Deferment Request PUB.

Length of Deferment: The Tax-Exempt Organization Volunteer deferment begins on the date the condition entitling the borrower to the deferment first existed, as determined by the lender.  The deferment ends no later than 3 years after the date on which it began, or the date on which the borrower's commitment is certified to end or actually ends, whichever is earlier.

For more information, visit the Department of Education's web page at www.ed.gov.