Who can use RAP
Most Direct Loan borrowers. The loans RAP can repay are Direct Subsidized, Direct Unsubsidized, Direct PLUS loans for graduate or professional students, and Direct Consolidation Loans that didn’t repay a parent PLUS loan.
- Borrowed on or after July 1, 2026? One loan first paid out on or after that date limits all your Direct Loans, older ones included, to RAP or the Tiered Standard Plan. If you don’t choose, you are placed in Tiered Standard. More
- All loans from before July 1, 2026? RAP is one option alongside IBR, the 10-year Standard, Graduated and Extended plans.
- Parent PLUS: not eligible, nor are consolidation loans that repaid one. Parent PLUS rules
- FFEL and Perkins: only after consolidating into a Direct Consolidation Loan, which then counts as a new loan. More
How the payment is calculated
- Take your adjusted gross income (AGI) from your latest tax return.
- Find its band below. The percentage applies to the whole AGI, not just the part inside the band.
- Divide by 12, then subtract $50 for each dependent claimed on your federal return. Your spouse isn’t a dependent.
- If the result is under $10, you pay $10.
Example: AGI $60,000 with two dependents. 5% × $60,000 = $3,000; ÷ 12 = $250; − $100 = $150 a month.
The step-ups: because one percentage covers all your income, crossing a $10,000 line raises everything. At $50,000 the payment is $166.67; one dollar more and it is $208.34, $41.67 more a month. The bands are fixed dollar amounts in the law with no inflation adjustment. The formula in detail
RAP payment table
Monthly payment by AGI band (no dependents)
| AGI | Yearly base | Monthly payment |
|---|---|---|
| $10,000 or less | $120 a year | $10.00 |
| $10,000 – $20,000 | 1% | $10.00 – $16.67 |
| $20,000 – $30,000 | 2% | $33.34 – $50.00 |
| $30,000 – $40,000 | 3% | $75.00 – $100.00 |
| $40,000 – $50,000 | 4% | $133.34 – $166.67 |
| $50,000 – $60,000 | 5% | $208.34 – $250.00 |
| $60,000 – $70,000 | 6% | $300.01 – $350.00 |
| $70,000 – $80,000 | 7% | $408.34 – $466.67 |
| $80,000 – $90,000 | 8% | $533.34 – $600.00 |
| $90,000 – $100,000 | 9% | $675.01 – $750.00 |
| More than $100,000 | 10% | $833.34 and up |
Monthly payment by AGI and dependents
| AGI | 0 dependents | 1 dependent | 2 dependents | 3 dependents |
|---|---|---|---|---|
| $25,000 | $41.67 | $10.00 | $10.00 | $10.00 |
| $40,000 | $100.00 | $50.00 | $10.00 | $10.00 |
| $55,000 | $229.17 | $179.17 | $129.17 | $79.17 |
| $70,000 | $350.00 | $300.00 | $250.00 | $200.00 |
| $85,000 | $566.67 | $516.67 | $466.67 | $416.67 |
| $100,000 | $750.00 | $700.00 | $650.00 | $600.00 |
| $125,000 | $1,041.67 | $991.67 | $941.67 | $891.67 |
Computed with the formula in 34 CFR 685.209. More worked examples: RAP payment by income and household.
Married borrowers
Filing jointly, RAP uses your combined AGI. If your spouse also has eligible federal loans, your payment is multiplied by your share of the couple’s combined balance (still at least $10). Filing separately, only your AGI and the dependents on your own return count. Married borrowers
The interest waiver and the $50 principal match
Two features keep the balance moving down, but only in months you pay the full bill on time:
- Interest waiver: interest your payment doesn’t cover is not charged.
- Principal match: if your payment cut principal by less than $50, the government adds the difference, up to the amount you paid. A $10 payment brings a $10 match, not $50.
One month, worked: $30,000 at 6% builds $150 of interest. With AGI $40,000 the RAP payment is $100. The $50 of interest it doesn’t cover is waived ($50), the match adds $50 to principal, and the balance ends the month at $29,950.00.
Paying more than the bill can shrink the waiver and match, and a prepayment usually moves your next due date forward. Interest waiver · Principal match · Paying extra
Forgiveness after 30 years
Whatever is left after 360 qualifying payments over at least 30 years is forgiven, provided you were on RAP at some point and your last payment before forgiveness was under RAP. Earlier progress on other income-driven plans counts toward the 360. Outside PSLF, the forgiven amount may be taxable. What counts toward the 360
RAP and Public Service Loan Forgiveness
On-time RAP payments count toward the 120 payments PSLF needs. RAP is the qualifying option for anyone limited to RAP or Tiered Standard, because StudentAid.gov says Tiered Standard payments don’t count. Deferment and forbearance months on RAP don’t count for PSLF and can’t be bought back. PSLF and RAP · PSLF calculator
RAP vs IBR vs Tiered Standard
| RAP | IBR | Tiered Standard | |
|---|---|---|---|
| Payment based on | All AGI, 1%–10% | AGI above 150% of poverty line, 10% or 15% | Balance and term |
| Lowest payment | $10 | $0 | $50 |
| Unpaid interest | Waived when on time | Builds up (waived 3 years on subsidized loans) | None (payment covers it) |
| Forgiveness | 30 years | 20 or 25 years | None; paid off in 10–25 years |
| Counts for PSLF | Yes | Yes | No |
| Open to loans from July 1, 2026 | Yes | No | Yes |
Example, single, AGI $50,000, $40,000 at 6.52%: RAP $166.67 a month, IBR (10%) $217.17, Tiered Standard $348.88 for 15 years. Which costs least overall depends on how long you pay; the calculator runs all three to the end. RAP vs IBR · Tiered Standard
How to enroll and stay on RAP
- Apply through the income-driven repayment application on StudentAid.gov, or through your loan servicer. It costs nothing.
- Consent to IRS data on the application, and the Department can recalculate your payment each year without paperwork.
- Every year the payment is reset from your latest income and dependents. If your income drops mid-year, you can ask for an earlier recalculation.
- If the Department can’t get your income information, the payment becomes the 10-year standard amount on your original balance until you provide it.
- Auto pay keeps payments on time, which the waiver and match depend on, and enrolling by Dec. 31, 2026 lowers your rate by 1 point through June 30, 2028.
Coming from SAVE
SAVE ended by court order in March 2026. Servicers began sending 90-day notices on July 1, 2026, followed by a final 30-day notice; borrowers who don’t choose are placed in Standard or Tiered Standard. RAP is one of the plans former SAVE borrowers can choose. SAVE: your deadline and options
Key dates
| July 4, 2025 | Public Law 119-21 creates RAP |
| May 1, 2026 | Final regulations published |
| July 1, 2026 | RAP opens; loans paid out from this date are limited to RAP or Tiered Standard |
| Dec. 31, 2026 | Last day to enroll in auto pay for the 1-point rate cut |
| July 1, 2027 | New loans lose unemployment and economic hardship deferments |
| July 1, 2028 | ICR and PAYE borrowers who haven’t chosen a plan are moved to RAP (or IBR) |
Questions people ask
Is RAP the only income-driven plan now?
For anyone with a Direct Loan first paid out on or after July 1, 2026, yes: RAP or Tiered Standard are the only plans, for all their Direct Loans. Borrowers whose loans are all older can still choose IBR, and PAYE or ICR until July 1, 2028 if they were already on them.
What is the lowest RAP payment?
$10 a month. An AGI of $10,000 or less gives a base payment of $120 a year, and $50 per dependent can take the payment no lower than $10.
Can my balance grow on RAP?
Not from interest in months you pay on time and in full: unpaid interest is waived. StudentAid.gov says that with every payment on time and no breaks after entering RAP, the balance won’t go above where it was when you entered. Interest from before RAP or from deferment and forbearance isn’t covered.
Do RAP payments count for PSLF?
Yes, on-time RAP payments count toward Public Service Loan Forgiveness. Tiered Standard payments don’t, according to StudentAid.gov.
Can parent PLUS loans use RAP?
No. Parent PLUS loans, and consolidation loans that repaid one, are excluded. See the parent PLUS calculator for the plans they can use.
Is RAP forgiveness taxed?
It may be. StudentAid.gov says that except for PSLF, you might owe federal or state income tax on a discharged amount.
Can I leave RAP?
Yes. Borrowers with newer loans can switch between RAP and Tiered Standard at any time. Borrowers eligible for IBR can move back to it, but RAP payments won’t count toward IBR forgiveness.
What happens if I don’t recertify?
If the Department can’t get your income information, your payment becomes what you would pay on a 10-year standard plan based on your balance when your loans entered repayment, until you provide it.
Not financial or legal advice. This page explains the published rules. It does not tell you which plan to choose. Your loan servicer and StudentAid.gov have the final word on your account.
Official sources
- Public Law 119-21, Sec. 82001 (HEA 455(q), the Repayment Assistance Plan)
- 34 CFR 685.209, income-driven repayment plans (as amended May 1, 2026)
- 34 CFR 685.208, Tiered Standard plan
- 34 CFR 685.219, Public Service Loan Forgiveness
- StudentAid.gov: One Big Beautiful Bill Act – Important Definitions (updated Aug. 24, 2026)
- StudentAid.gov: SAVE Plan Borrowers FAQ (October 2026)
- Department of Education, Sept. 29, 2026: auto pay rate reduction extended
Last verified Oct 17, 2026. Corrections are logged on What changed.