The Repayment Assistance Plan took effect July 1, 2026 as the federal income-based repayment option, replacing the closed SAVE and older IDR plans for new enrollment. Its formula is one line: a percentage of your total AGI, 1% to 10% depending on income, divided by 12, minus $50 per dependent, floored at $10. Whatever's left after 360 qualifying payments, which is 30 years, is forgiven.
RAP abandons the discretionary-income formula everyone loved to hate. Old plans took 10-20% of income above a poverty deduction, which meant payment charts full of phase-ins. RAP just asks what you made, picks a percentage from a ladder, and applies it to the whole number:
| AGI | Rate | Example payment |
|---|---|---|
| Up to $10,000 | flat $10 | $10.00 |
| $10,001-$20,000 | 1% | $15,000 → $12.50 |
| $30,001-$40,000 | 3% | $35,000 → $87.50 |
| $50,001-$60,000 | 5% | $55,000 → $229.17 |
| $70,001-$80,000 | 7% | $75,000 → $437.50 |
| $90,001-$100,000 | 9% | $95,000 → $712.50 |
| Over $100,000 | 10% | $120,000 → $1,000.00 |
Verify a row by hand: $55,000 sits in the 5% band, 0.05 × 55,000 = $2,750 a year, ÷ 12 = $229.17. The dependent credit subtracts $50 per person, so that same borrower with two kids pays $129.17.
Three shifts matter. First, the $0 payment is gone: SAVE zeroed bills below 225% of the poverty line, while RAP's floor is $10 from the first dollar of income. Second, the base is total AGI, not income minus a poverty allowance, which raises bills at low incomes but simplifies everything. Third, forgiveness runs 20 years for undergraduate-only debt, 25 if any graduate loans are in the pile, with annual income recertification keeping the payment matched to reality.
The compensation is the cap. At any income, the payment never exceeds 10% of AGI, and unpaid interest is subsidized so a low payment doesn't grow the balance the way negative amortization once did. For a borrower whose income collapses, that ceiling is worth real money.
AGI, dependents, debt type in; your RAP payment, annual total, and forgiveness timeline out.
RAP Student Loan Calculator →RAP shines when income is low relative to debt, and fades as income grows. At $50,000 AGI the payment is $166.67, which beats a $338.97 standard payment on a $30,000 balance, but 30 years of those payments total about $60,000, half again what the standard plan's $40,676 costs over 10 years. Run your crossover point with our calculators: the RAP calculator for the income side, the refinance calculator for the payoff side. High-income borrowers with modest balances usually find refinancing wins outright, and should note that consolidation before switching plans can reset the forgiveness count.
10% of AGI, reached above $100,000 of income. At $100,001 the payment is $833.34 a month; at $150,000 it's $1,250. That cap is RAP's real protection: the payment scales with income on the way up, but the percentage never exceeds 10% no matter the balance.
The plan's design traded zero payments for simplicity. Old income-driven plans subtracted a poverty-line allowance from income and could produce $0 bills; RAP instead charges a percentage of total AGI starting at 1%, floored at $10 a month. Every borrower pays something, which also means every month counts and interest subsidies keep balances from growing on the plan.
Possibly. The ARPA exclusion made student loan forgiveness federally tax-free through 2025, but it hasn't been extended past that, so balances forgiven in 2026 and later may count as taxable income in the year of forgiveness. If you're more than a decade from the finish line, model the tax bomb before assuming forgiveness beats paying the loan off.
Not directly. Parent PLUS borrowers reach income-driven repayment only through the double consolidation loophole, and RAP's rules phase in for Direct loans generally. Parent borrowers should check current Department of Education guidance before relying on any income-based plan, since PLUS eligibility has historically been the narrowest.
Educational content, not financial advice. RAP rules were still phasing in as of mid-2026; confirm details with StudentAid.gov or your servicer.