Financial Aid for Medical Students
- Loan Information
- Scholarship Information
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Grant
Information
Something you may be worrying about is how best to satisfy your student loan lenders while not living on ramen during your residency years. Many of you will be in your 6-month grace period right now-so this is the time to sort everything out before large payments come due. Most programs require application a few months before the grace period ends to account for processing time.
Here are some resources and programs that can help you get off on the right foot:
Income Based Repayment
Income Based Repayment (IBR) is a repayment plan for federal loans that restricts your monthly payment amount to an amount that is intended to be affordable-taking into account both income and family size. Best part? Under this program any remaining loans will be forgiven after 25 years and only 10 years for those who work in public service jobs such as non-profits. Most hospitals and community clinics qualify for the 10 year non-profit plan.
On a resident's salary you are very likely to qualify for IBR during your residency years. To see if you qualify visit: http://studentaid.ed.gov/PORTALSWebApp/students/english/IBRCalc.jsp
You must contact each of the servicers that service your loans to apply for IBR. Direct Loan borrowers can go to www.dl.ed.gov. If you are unsure who holds your loans or who your loan servicer is, you can access the U.S. Department of Education's National Student Loan Data System (NSLDS) Web site at www.nslds.ed.gov.
Public Service Loan Forgiveness
The Public Service Loan Forgiveness (PSLF) Program was established to encourage individuals to enter and continue in full-time public service employment by forgiving the remaining balance of their William D. Ford Federal Direct Loan Program loans after the borrower has made 120 qualifying monthly payments (beginning anytime after October 1, 2007) while employed full-time by a public service organization. Questions? Go here: http://studentaid.ed.gov/students/attachments/siteresources/PSLF_QAs_final_02%2012%2010.pdf
Expanded Tax Benefits to Physicians in HPSA
As part of a larger Administration announcement on efforts to strengthen the health care workforce, the Internal Revenue Service today announced that under the Affordable Care Act health care professionals who received student loan relief under state programs that reward those who work in underserved communities may qualify for refunds on their 2009 federal income tax returns as well as an annual tax cut going forward.
The Affordable Care Act included a change in the law, effective in 2009, that expands a tax exclusion for amounts received by health professionals under loan repayment and forgiveness programs. Prior to the new law, only amounts received under the National Health Service Corps Loan Repayment Program or certain state loan repayment programs eligible for funding under the Public Health Service Act qualified for a tax exclusion.
The Affordable Care Act expands this tax exclusion to include any state loan repayment or loan forgiveness programs intended to increase the availability of health care services in underserved areas or health professional shortage areas and makes this exclusion retroactive to the 2009 tax year.
Health care professionals participating in these programs who have reported income from repaid or forgiven loan amounts on their 2009 returns, possibly after receiving a Form W-2, Wage and Tax Statement, or Form 1099, may be due refunds. Those who believe they qualify for this relief may want to consult their state loan program offices to determine whether the program is covered by the new law.
Health care professionals who have not yet filed for 2009 need not report eligible loan repayment or forgiveness amounts when they file. Those who have already filed may exclude eligible amounts by filing Form 1040X, Amended U.S. Individual Income Tax Return. This form can be downloaded from this website or obtained by calling the IRS toll-free at 1-800-TAX-FORM (1-800-829-3676). Individuals filing Form 1040X to claim this exclusion should write "Excluded student loan amount under 2010 Health Care Act" in the Explanation of Changes box.
Health care professionals may request an employer or other issuer to provide a Form W-2c, Corrected Wage and Tax Statement, or 1099 and may attach the corrected form to the Form 1040X. However, the Form 1040X may also be filed without attaching a corrected form.
National Health Service Corps
Have a lot of medical school debt? Interested in working in a Health Professional Shortage Area and ensuring that individuals receive the care they need? NHSC may be for you! This program allows primary care physicians working full-time at an approved National Health Service Corps site to receive $50,000 toward repayment of their health professions student loans for 2 years of service and can apply for additional support for extended service - as much as $145,000 for 5 years! Applications are competitive so apply now and take advantage of this great opportunity. For more information please see: http://nhsc.hrsa.gov/loanrepayment/apply.htm
Wondering how to pay for medical school? NHSC can help!
The National Health Service Corps also has a scholarship program! Although the deadline has passed for this year, it's time to start thinking about applications for 2011-2012. The National Health Service Corps scholarship pays tuition, required fees, and some other education costs, tax free, for as many as four years. Education costs may include books, clinical supplies, laboratory expenses, instruments, two sets of uniforms and travel for one clinical rotation. Recipients also receive a monthly taxable stipend ($1,326 in 2010-2011).
Marriage "Penalty" reduced for Income Based Repayment Program as of July 1, 2010
Under changes made to the IBR regulations that will take effect July 1, 2010, married borrowers who file joint tax returns and who both have eligible student loan debt will have their individual IBR eligibility determined based on their joint income and the combined eligible loan debt of both spouses. For couples who are both physicians and/or both have significant student loan debt this may reduce your payment substantially.
For more information on the Income Based Repayment Program visit: http://studentaid.ed.gov/PORTALSWebApp/students/english/IBRPlan.jsp
Unlike loans, scholarships are "monetary gifts" that don't need to be repaid. However, unlike grants, they are earned through scholastic and leadership achievements. Scholarships may be available through national, state, or federal organizations, as well as through your school's financial aid office. For the latter, please check with your medical school.
Silicon Valley Community Foundation: the foundation is supported by private donations and provides various grants and scholarships to residents of San Mateo and Santa Clara Counties.
Phi Beta Kappa Northern California Association (PBK NCA): PBK NCA is a non-profit organization that awards annual scholarships to students enrolled in a graduate program in a Northern California university. Eligible medical schools include: Stanford University; University of California, Davis; and University of California, San Francisco.
Health Professions Education Foundation Scholarships: these scholarships are provided to aspiring health professionals who agree to practice in a medically underserved area for up to four years.
Pisacano Scholars Leadership Program: established by the American Board of Family Medicine, this program offers up to five grants per year to eligible third-year medical students.
Herbert W. Nickens Medical Student Scholarships: very year, AAMC awards five scholarships to outstanding third-year medical students. You should apply as soon as the scholarship application requirements become available as the AAMC only accepts one nomination per medical school per year.
National Health Service Corps (NHSC) Scholarship: the NHSC scholarship provides funds to medical students who agree to serve from two to four years in a NHSC-approved community-based site in a high-need Health Professional Shortage Area.
Paco Tomei Scholarship Search: http://scholarships.fatomei.com/
FastWeb: www.fastweb.com/
Student Scholarship Search, a service of the Student Loan Network: www.studentscholarshipsearch.com
ScholarSite, a service of the TIYM Publishing Company, Inc.: www.scholarsite.com/index.asp
Loan Repayment/Forgiveness and Scholarship Programs, AAMC: http://services.aamc.org/fed_loan_pub/index.cfm?fuseaction=public.welcome&CFID=626960&CFTOKEN=39250362
Similar to scholarships, grants are provided gratis. In most cases, students must meet certain financial requirements and be in good academic standing in order to qualify.
Federal Work Study Program: this program assists students receiving postsecondary education through part-time employment. It's available through your school's financial aid office; the deadline may be earlier than the deadline for filing a FAFSA.
Institutional Grants: these grants are provided through individual universities. Please check with your medical school's financial aid office for availability.
Click here for more information on federal student assistance.
Health Careers Training Program (HCTP) Mini-Grants: the HCTP grants provide direct and indirect support for underrepresented and/or economically disadvantaged students currently pursuing careers in health care.
To find out more about medical student debt, visit the American Medical Association Foundation, American Medical Student Association, and the American Academy of Family Physicians.
More information can be found on the following Web sites:AAFP: www.aafp.org
AAMC: www.aamc.org
FTC: www.ftc.gov
US Department of Education: www.ed.gov
Sallie Mae: www.salliemae.com
Medical School Loans: www.medicalschoolloans.com
FAFSA: www.fafsa.ed.gov
Federal Direct Consolidation Loans Information Center: www.loanconsolidation.ed.gov
SLBA project, department of the National Consumer Law Center: www.studentloanborrowerassistance.org
PBK NCA: www.pbknca.org
California Student Aid Commission: www.csac.ca.gov and www.calgrants.org
Office of Statewide Health Planning and Development: www.oshpd.ca.gov
College Scholarships and Grants: www.collegescholarships.org
NHSC, US Department of Health and Human Services: www.nhsc.hrsa.gov
Health Resources and Services Administration, US Department of Health and Human Services: www.hrsa.gov
IBRInfo: www.ibrinfo.org
Equal Justice Works: www.equaljusticeworks.org
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