ND State Loan Repayment Frequently Asked Questions
The purpose of the North Dakota Student Loan Repayment Programs is to recruit and retain healthcare providers in underserved areas of North Dakota.
Loan repayment must only be used to repay qualifying outstanding educational loans.
You can apply to all eligible loan repayment programs, but you can only accept one of the programs. Each program requires that you have no other service obligation to any other program.
Applications are available year-round; however, the application deadline each year is March 15. Providers are selected by the end of May based on quality of application and available funding. Veterinarian applications are due annually on January 31st.
The North Dakota Health Care Professional Student Loan Repayment Programs require matching funds. These matching funds may come from your clinical
site, or any public or private entity. However, the matching funds cannot be from an individual. Funds from the State of North Dakota, as well as the
community match funds are exempt from federal income and employment taxes.
Federal State Loan Repayment Program (SLRP) requires matching funds. These funds can be from your clinical site of employment, any public or private entities. Federal funds may not be used for the community match. Federal SLRP funds, as well as community match funds are exempt from federal income and employment taxes.
Yes, the loan repayment awards are competitive. The criteria considered includes: site eligibility, applicant eligibility, letters of recommendation, personal statement, and any formal education in North Dakota or ties in any way to North Dakota.
Applications will be evaluated on the provider’s commitment to medically underserved populations, commitment to primary care, the ability of the provider to meet the unique needs of the community, demonstrated cultural competencies, and geographic need throughout the state.
Cultural competency means the applicant’s ability to serve diverse populations. These competencies may include, but are not limited to: clinical rotations in an underserved area/population; volunteer hours serving or working with an underserved area/population; background from diverse ethnic or racial communities; and/or, fluency in more than one language.
For the North Dakota Health Care Professional Student Loan Program and Dental Loan Repayment Program, a qualified educational loan means a government
or commercial loan for actual costs paid for tuition, reasonable education expenses and reasonable living expenses related to the graduate or undergraduate education of
a health care professional.
The Federal State Loan Repayment Program (SLRP) restricts eligible loans to government and commercial loans for educational purposes related to the degree under which you will be completing your service obligation.
Educational loans that have been paid in full, are in default, or were obtained for someone other than the applicant do not qualify. Personal lines of credit, credit card debt, and debt associated with relocation or residency programs, do not qualify for repayment.
For ND-SLRP prospective applicants, search the following databases by copying this link https://datawarehouse.hrsa.gov/tools/analyzers/HpsaFind.aspx into a new browser URL. You must be in a Health Professional Shortage Area (HPSA) to receive a SLRP award.
If you are awarded the North Dakota Health Care Professional Student Loan Repayment Program award, your payment is sent directly to your lender in June of each
year. A verification form is sent to providers/facilities for completion prior to payment. Community match is paid to the lending institution or provider at the end of
each year or in a lump sum.
If you are awarded the North Dakota Dental Health Loan Repayment Program award your payment is sent directly to you in June of each year after you have completed a year from the beginning contract date. A verification form is sent to providers/facilities for completion prior to payment.
If you are awarded the Federal State Loan Repayment Program (SLRP), your payment is paid directly to the provider 90 days from your contract start date for the federal portion. Half of the community match must be paid to provider or lender by the community one year from contract start date and final payment must be made by the end of the contract date. A verification form is sent to providers/facilities for completion prior to payment. The Primary Care Office must receive a copy of the lending statement after the end of your first year of your contract.
If you need to take a leave of absence during your North Dakota Health Care Professional Student Loan Repayment, North Dakota Dental Health Loan Repayment Program,
or the Federal State Loan Repayment Program (SLRP) contract, you must inform North Dakota Primary Office staff. You must also put in writing to the North Dakota State Health
Council (HC) the anticipated leave period and reason for the leave. The provided information will be presented by the North Dakota Primary Care Office to the HC and your remaining
contract may be adjusted/extended to account for that time of leave.
Service obligations may be released or suspended as a result of an illness, disability or temporary job transfer. All requests for temporary suspension of service must be in writing in advance (if known) and substantiated by documentation deemed acceptable and approved by the HC for State Healthcare Professional and Dental programs and the Bureau of Health Workforce, Health Resources and Services Administration for SLRP on a case−by−case basis. The agreement end date may be extended by the amount of time a participant is in suspension status.
No, refer to section below for details and share with your tax preparer.
TAX INFORMATION ON LOAN REPAYMENT PROGRAMS
1. IRS Publication 970 states the following regarding student loan repayment assistance programs "Student loan repayments made to you are tax free if you received them for any of the following:
a. The National Health Service Corps Loan Repayment Program.
b. A state education loan repayment program eligible for funds under the Public Health Service Act.
c. Any other state loan repayment or loan forgiveness program that is intended to provide for the increased availability of health services in underserved or health professional shortage areas (as determined by such state).
d. You cannot deduct the interest you paid on a student loan to the extent payments were made through your participation in the above programs."
2. Payments under certain state loan repayment programs.
a. In the case of an individual, gross income shall not include any amount received under section 338B(g) of the Public Health Service Act, under a State program described in section 338I of such Act, or under any other State loan repayment or loan forgiveness program that is intended to provide for the increased availability of health care services in underserved or health professional shortage areas (as determined by such State).
b. Under 26 U.S.C. § 3401(a) (19), state loan repayment program payments are also not considered to be "wages" and are, therefore, exempt from Federal employment tax (FICA).
a. For purposes of this chapter, the term "wages" means all remuneration (other than fees paid to a public official) for services performed by an employee for his/her employer, including the cash value of all remuneration (including benefits) paid in any medium other than cash; except that such term shall not include remuneration paid.
b. For any benefit provided to or on behalf of an employee, if at the time such benefit is provided, it is reasonable to believe that the employee will be able to exclude such benefit from income under section 74(c), 108(f)(4), 117, or 132.