Arkansas Student Loan Forgiveness Programs
Arkansas offers student loan repayment assistance programs that lean heavily toward teachers. STEP helps the most working borrowers, paying teachers in shortage subjects or shortage areas up to $6,000 a year toward federal loans, while other programs fund future teachers, osteopathic medical students, and food animal veterinarians. Doctors, nurses, and everyone else should start with federal forgiveness programs, where the bigger dollars are.
Arkansas Programs At A Glance
| Program | Who Qualifies | Maximum Award | Service Required | Status |
|---|---|---|---|---|
| State Teacher Education Program (STEP) | Licensed public school teachers in shortage subjects or shortage areas | $6,000/year for up to 3 years ($18,000 total) | Teach full time in an Arkansas public school each award year | Annual Cycle |
| Out-Of-State Veterinary Medical Education Loan Repayment Program | Mississippi State veterinary graduates practicing food supply veterinary medicine | Not published; repayment for up to 5 years | Food supply veterinary practice in Arkansas | Annual Cycle |
| Arkansas Teacher Academy Scholarship | Students in Arkansas teacher preparation programs | $6,000/semester for tuition and program fees | 1 year teaching in an Arkansas public school per year funded | Twice Yearly |
| Osteopathic Rural Medical Practice Student Loan And Scholarship Program | Arkansas residents in DO programs at Arkansas medical schools | $12,000/year | 1 year of rural primary care practice per year of loan | Open |
Programs That Help Repay Loans You Already Have
Arkansas borrowers carry roughly $34,200 in federal student debt on average, according to our Arkansas student loans and financial aid breakdown. These programs send money toward that debt once you're working in a qualifying job. Compare them against Public Service Loan Forgiveness, since many qualifying Arkansas employers are also PSLF employers.
State Teacher Education Program (STEP)
STEP pays up to $6,000 a year toward the remaining federal loan balance of Arkansas teachers who teach in a subject or geographic shortage area, for up to three years (Arkansas Division of Higher Education). That's up to $18,000, which teachers can combine with the federal programs in our list of student loan forgiveness options for teachers.
| Administered by | Arkansas Division of Higher Education ([email protected], 501-371-2000) |
| Who qualifies | Graduates of a teacher education program after April 2004 who hold a valid Arkansas teaching license and teach full time in an Arkansas public school district in a designated shortage subject or area |
| Award | Up to $6,000 a year, for up to three years |
| Eligible loans | Federal student loans only |
| Residency | Arkansas resident for at least 12 months before the deadline; citizen or lawful permanent resident |
| Status | Annual deadline of July 1, with final documents due July 15; ADHE notes award amounts depend on legislative funding |
| Official source | ADHE STEP page |
Out-Of-State Veterinary Medical Education Loan Repayment Program
This program helps repay federal student loans for up to five years for Arkansas veterinarians who graduated from Mississippi State University's College of Veterinary Medicine and practice food supply veterinary medicine in Arkansas (Arkansas Division of Higher Education). ADHE doesn't publish an annual dollar amount, so vets should also check the federal program covered in our list of student loan forgiveness programs.
| Administered by | Arkansas Division of Higher Education |
| Who qualifies | Mississippi State veterinary graduates after April 2012 with a valid Arkansas veterinary license who start food supply practice in Arkansas within 90 days of finishing their degree or internship |
| Award | Not published; repayment of federal student loans for up to five years |
| Residency | Arkansas resident for at least 12 months before the deadline; citizen or lawful permanent resident |
| Status | Annual deadline of July 1 |
| Official source | ADHE Out-Of-State Veterinary Loan Repayment page |
Service-Based Funding For Students In Training
These two programs pay for school up front and cancel the debt through work in Arkansas after graduation. They count as forgiveness only if you complete the service, and walking away turns the award into a loan you repay, so weigh them against a private student loan with no strings attached.
Arkansas Teacher Academy Scholarship
The Teacher Academy Scholarship pays up to $6,000 a semester for tuition and program fees to students in an Arkansas teacher preparation program who commit to teaching in an Arkansas public school (Arkansas Division of Higher Education). Recipients must teach one year for every year of funding, starting within a year of finishing, or the award converts into a loan. Current teachers with loans should look at STEP and our teacher forgiveness breakdown instead.
| Administered by | Arkansas Division of Higher Education |
| Who qualifies | Arkansas residents (at least 12 months before enrolling) accepted into an educator preparation program, including high school graduates, current college students, and career changers |
| Award | Up to $6,000 a semester for tuition and program fees |
| Service | One year of teaching in an Arkansas public school for each year of funding, starting within one year of completion |
| Penalties | Unfulfilled service converts the award into a loan you must repay |
| Deadlines | July 1 for fall and January 10 for spring |
| Official source | ADHE Teacher Academy Scholarship page |
Osteopathic Rural Medical Practice Student Loan And Scholarship Program
This program lends Arkansas residents in Doctor of Osteopathic Medicine programs at Arkansas medical schools $12,000 per academic year, which ADHE says is the most current funding can support (Arkansas Division of Higher Education). Each full year of full-time primary care practice in a qualifying rural Arkansas community converts one year's loan into a scholarship (ADHE program fact sheet). Compare the terms with a standard medical school student loan before signing.
| Administered by | Arkansas Division of Higher Education |
| Who qualifies | Arkansas residents accepted to or enrolled in good standing in a DO program at an Arkansas medical school |
| Award | $12,000 per academic year ($6,000 per semester) |
| Service | One year of full-time primary care practice per year of loan, in a community under 20,000 people that's at least 20 miles from a city over 20,000 |
| Penalties | Defaulting borrowers repay with interest at the lesser of Arkansas's maximum legal rate or 5% above the federal discount rate, and can face suspension of their Arkansas medical license |
| Status | Listed as available; ADHE doesn't publish a deadline |
| Official source | ADHE Osteopathic Rural Medical Practice page |
Federal Forgiveness Options For Arkansas Borrowers
Federal programs reach far more Arkansas borrowers than the four state programs, and each one runs on its own rules for combining with a state award. Our full list of forgiveness programs covers every federal option.
Public Service Loan Forgiveness (PSLF). Borrowers who make 120 qualifying payments while working full time for a government agency or qualifying nonprofit get their remaining Direct Loan balance forgiven tax-free (StudentAid.gov). Arkansas public school teachers, state and county employees, and public university staff all work for qualifying employers, and our PSLF breakdown covers the 2026 employer rule litigation.
Teacher Loan Forgiveness. Teachers with five consecutive years at a low-income school can receive up to $17,500 if they teach secondary math, science, or special education, or up to $5,000 in other subjects (StudentAid.gov). The same years can't count toward both Teacher Loan Forgiveness and PSLF, which our teacher forgiveness breakdown walks through.
Repayment Assistance Plan (RAP) and IBR. RAP launched July 1, 2026, and forgives any remaining balance after 360 qualifying payments (How RAP Works). Borrowers deciding between plans can run the numbers in our RAP vs. IBR comparison.
Health care programs. The National Health Service Corps pays full-time primary care providers up to $75,000 for a two-year commitment, plus a $5,000 bonus for providers who serve patients in Spanish (HRSA). Nurse Corps pays 60% of nursing debt for two years of service and another 25% for a third year (HRSA), and the STAR program pays up to $250,000 for six years in substance use disorder treatment (HRSA). HRSA also lists the University of Arkansas for Medical Sciences as Arkansas's State Loan Repayment Program grantee (HRSA), and our nursing and health care forgiveness roundup covers eligibility for the federal programs.
Veterinarians. Arkansas food animal vets who didn't train at Mississippi State can turn to the USDA Veterinary Medicine Loan Repayment Program, which pays up to $25,000 a year for service in designated shortage areas (USDA NIFA). Vets carrying private loans should also check our list of private student loan forgiveness options.
Is Student Loan Forgiveness Taxed In Arkansas?
Arkansas doesn't base its income tax on federal rules, and it sets its own treatment of forgiven student loans (The College Investor). PSLF is excluded from Arkansas income, but other types of forgiveness, including forgiveness under income-driven plans, are taxable in Arkansas.
Forgiveness under income-driven plans also became federally taxable again on January 1, 2026, when the American Rescue Plan exclusion expired (Taxes And Student Loan Forgiveness). Borrowers expecting IBR or RAP forgiveness will owe at both levels, and can estimate the bill with our student loan tax bomb calculator.
Arkansas also offers a subtraction for interest paid on qualified education loans. Ask ADHE whether your STEP or veterinary award will be reported as income, and read our explainer on the 1099-C and student loan forgiveness before filing.
If Your Job Isn't Covered
Borrowers outside teaching, veterinary medicine, and osteopathic medicine won't find an Arkansas program, but three options remain. Employers can pay up to $5,250 a year toward your student loans tax-free, and our list of companies that offer student loan repayment assistance shows who offers it.
Borrowers with private loans or high-rate federal loans they don't plan to have forgiven can lower their rate through student loan refinancing. Refinancing federal loans into a private loan ends eligibility for PSLF, RAP, and IBR, so don't refinance a balance you expect to have forgiven.
Families with leftover 529 money can put up to $10,000 per beneficiary toward student loans, which our 529 plan for student loan repayment explainer covers. Arkansas savers should also review the Brighter Future 529 Plan.
Frequently Asked Questions
Does Arkansas Have A Student Loan Forgiveness Program?
Arkansas offers student loan repayment assistance programs rather than broad loan forgiveness. It runs four service-based programs for teachers, future teachers, food animal veterinarians, and osteopathic medical students. Borrowers outside those fields rely on federal programs like PSLF and income-driven plan forgiveness.
How Much Can Arkansas Teachers Get Toward Their Student Loans?
STEP pays up to $6,000 a year for three years, or $18,000, and federal Teacher Loan Forgiveness adds up to $17,500 for five years at a low-income school (StudentAid.gov). Public school teachers can also pursue PSLF, but years used for Teacher Loan Forgiveness can't also count toward PSLF.
Can Arkansas Doctors And Nurses Get Help Repaying Student Loans?
None of the Arkansas Division of Higher Education's listed programs repay loans for practicing doctors or nurses, so they rely on federal programs like the National Health Service Corps and Nurse Corps (HRSA). Osteopathic students can lock in rural practice funding before graduating, and our doctor forgiveness breakdown covers the federal options.
Is Student Loan Forgiveness Taxable In Arkansas?
Arkansas excludes PSLF from income but taxes other forgiveness, including income-driven plan forgiveness (The College Investor). Use our tax bomb calculator to estimate what you'd owe.
Related Arkansas Resources
How We Sourced This Data
Program details on this page come from the administering agency: the Arkansas Division of Higher Education's scholarship and program pages (STEP, the Out-Of-State Veterinary Medical Education Loan Repayment Program, the Teacher Academy Scholarship, and the Osteopathic Rural Medical Practice program) and its program fact sheet. Federal program details come from StudentAid.gov, HRSA, and USDA NIFA. Read more about how we fact-check and update content.
Page refreshed annually in August, after Arkansas's legislative session and agency rule approvals, and reviewed in January for tax season. Last full refresh: September 23, 2026.
Editor: Clint Proctor Reviewed by: Claire Tak