How this calculator works
RAP charges a percentage of adjusted gross income that rises with income (1% to 10%), less $50 a month per dependent, with a $10 minimum. Legacy plans charge 10%, 15% or 20% of discretionary income, which is income above 150% (or 100% for ICR) of the poverty guideline for your household size, capped at the standard payment.
Worked example
With the example values below: RAP monthly payment, $229.17 (5% of AGI, less $50 per dependent). Change any number above to run your own.
What you enter
| Input | Example |
|---|---|
| Adjusted gross income | $55,000 |
| Household size | 1 |
| DependentsUsed for RAP | 0 |
| State | Contiguous US |
| Federal loan balance | $40,000 |
| Weighted interest rate | 6.5% |
The Repayment Assistance Plan (RAP)
RAP is the new income-based plan for federal Direct Loans, available from July 1, 2026. Payments are a percentage of your adjusted gross income, from 1% at lower incomes to 10% at $100,000 and above, minus $50 a month for each dependent, with a $10 monthly minimum. Any remaining balance is forgiven after 30 years of qualifying payments.
RAP also helps keep balances from growing: interest not covered by an on-time payment is waived, and if a payment reduces principal by less than $50, the government adds a matching principal reduction up to $50.
Legacy plans: IBR, PAYE and ICR
Borrowers with loans made before July 1, 2026 can use RAP or keep income-driven plans that are being phased out. Income-Based Repayment (IBR) remains available to existing borrowers; PAYE and ICR are being closed to new enrollment and must be left by July 1, 2028.
Legacy plans charge a share of discretionary income, which is income above 150% of the poverty guideline for your household size (100% for ICR). IBR charges 10% for newer borrowers or 15% for older ones; ICR charges 20%. Payments are generally capped at the standard 10-year amount, except under ICR.
Choosing a plan
You must recertify income each year. Missing recertification can raise your payment to the standard amount.
- Lowest payment now: compare RAP and IBR at your income and family size.
- Pursuing Public Service Loan Forgiveness: choose the lowest qualifying payment, since the balance is forgiven after 120 payments.
- High income relative to debt: the standard plan may cost less in total.
- Expecting rising income: income-based payments will rise too, so compare the long-run cost.
Forgiveness and taxes
Public Service Loan Forgiveness is tax-free. Forgiveness at the end of an income-driven plan was made tax-free federally through 2025; from 2026 it may be taxable as income unless the law changes, so plan for a possible tax bill. Some states tax forgiven debt separately.
Parent PLUS loans have different rules; see the Parent PLUS loan calculator.
Frequently asked questions
How is the RAP payment calculated?
A percentage of adjusted gross income, from 1% at lower incomes up to 10% at $100,000 and above, divided by 12, minus $50 a month per dependent, with a $10 minimum. On $60,000 of AGI with one dependent, that's about $250 a month.
Who is eligible for the Repayment Assistance Plan?
Borrowers with federal Direct Loans, other than Parent PLUS loans, starting July 1, 2026. Borrowers with loans made from that date can choose only RAP or the standard plan.
What happened to the SAVE plan?
SAVE was blocked by the courts and is being ended by the 2025 law. Borrowers enrolled in SAVE must move to another plan such as RAP or IBR.
Is income-driven repayment forgiveness taxable?
Federal tax relief on forgiveness at the end of income-driven plans covered forgiveness through 2025. From 2026, it may be treated as taxable income unless Congress extends the relief. Public Service Loan Forgiveness remains tax-free.
Do I need to recertify my income every year?
Yes. You must recertify income and family size annually, and you can recertify early if your income drops. Many borrowers can allow the Department of Education to retrieve tax information automatically.
Grow what this calculator projects.
TruthSayer AI sends quantitative stock signals across valuations, earnings and dark-pool activity, each one traded in its own funded account first.
Estimates for planning only, not financial, tax or legal advice. Tax tools use 2026 federal figures (brackets, $16,100 / $32,200 standard deduction, $19,000 gift exclusion, $15M lifetime exemption). Rates shown as defaults are examples; replace them with quotes you actually receive.