Do pastor positions at church that files as a 501(c)(3) qualify for public service loan forgiveness under IBR?

Question

Most churches are 501(c)(3) non-profits. Under the (IBR) Income-Based Repayment plan, it states that public service positions can get loans forgave in 10 years instead of 25 (well 20 after changes Obama mentioned tonight in the SOU address). One of the public service positions is defined as, "Your job is eligible if you are employed by any nonprofit, tax-exempt 501(c)(3) organization" (http://www.ibrinfo.org/what.vp.html#eligible).

This sounds straight forward enough but then below that it says there are 2 test questions for any that don't fit categories mentioned. It seems that this is only if its not a tax-exempt organization but the wording makes me wonder if there is an exclusion regardless. It states,
"(1) your employer is not "a business organized for profit, a labor union, a partisan political organization, or an organization engaged in religious activities, unless the qualifying activities are unrelated to religious instruction, worship services, or any form of proselytizing;""

It sounds like those positions are not considered public service then even if they are a 501(c)(3) but does it matter since they are registered that way tax wise?

I thank everyone in advance for their hopefully helpful informative responses. If anyone can give personal experience one direction or another on this question or cite direct evidence, it would be majorly appreciated!

Answer 1

No, a pastor would NOT qualify for loan forgiveness because, although it might be a nonprofit, tax-exempt 501(c)(3) organization, a pastor position is OBVIOUSLY a job that would "engage in religious activities, religious instruction or worship services". If you want documentation, read the job description.