CLRP Eligibility Requirements for the Navy Reserves

The College Loan Repayment Program or CLRP is a military enlistment incentive to help people who serve in the military pay off college education debt. For the Navy Reserves, eligible members may have had prior military service. The Navy Reserve will pay up to $10,000 of loan debt for service members. For every year in the service, the Navy Reserves will pay either 15% of the outstanding loan balance, or $1,500, whichever amount is greater. The program will not pay any accrued interest.

It is important to remember that the income from this program is taxable, so 28% of the payment amount will be sent to the IRS to withhold for tax purposes. In the example of a maximum annual payment of $1,500, only $1,080 would go to the lender because $420 would go to the IRS. A 1099 form will be sent to the reservist from the military to account for this.

 


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