Not in PSLF…for public service loans, the forgiven amount doesn’t count as taxable income. That’s only under the forgiveness policy of the regular loans forgiveness, which happens after 20 or 25 years depending on the type of loan and when it was borrowed.
I agree that public service jobs and careers are very important. I just think that if we are going to pay for them, then we as a society should be transparent and establish a national (or state-by-state) scholarship program for public service careers that awards scholarships to students if they agree to serve in a public service career for a period of 10 years. This also allows the selection of students who will receive the scholarship. I’m also not necessarily against PSLF either, I just think the amounts should be capped (as should regular IBR amounts).
The other danger with borrowing lots with the expectation of PSLF is that you never know how your career desires and goals will change. I went to graduate school to get a PhD in public health and had every intention of becoming a researcher at a government agency or nonprofit or a professor. I ended up doing research at a for-profit technology company (definitely not eligible for PSLF). On the flip side, I have some friends who would be interested in leaving their public service jobs for related careers in for-profit companies, but they feel like they can’t because they borrowed so much money for undergrad and grad that they need to stay in public service to repay loans. These people are less than 5 years into their careers, so they’ve got a ways to go before they have total career freedom.