RAP is a new federal income-driven student loan plan (effective July 1, 2026) where your monthly payment is a tiered 1%–10% of your entire AGI, with a $10 minimum, a $50-per-dependent cut, waived unpaid interest, matching principal when principal repaid is under $50, and 30-year forgiveness.
Guide · Updated September 29, 2026
Repayment Assistance Plan (RAP): what it is & how it works
RAP is the brand-new federal income-driven student loan plan for 2026. Here's exactly how it works — payments, eligibility, and the 30-year forgiveness — in plain English.
The short answer
The Repayment Assistance Plan (RAP) is a new federal income-driven repayment plan, created by the One Big Beautiful Bill Act and effective July 1, 2026. Your monthly payment is a tiered percentage (1%–10%) of your entire adjusted gross income, never less than $10/month. Unpaid interest is waived, Education matches principal when an on-time payment reduces principal by less than $50, and any balance left is forgiven after 30 years.
See your own number in under a minute: compare RAP with IBR using our RAP vs IBR calculator →
How your RAP payment is calculated
Your annual payment is based on your prior-year adjusted gross income (AGI) from your most recent tax return. The percentage applies to all of that AGI (34 CFR 685.209(b)(2)), and it rises one point per $10,000 band:
| AGI (prior-year return) | Annual payment | ≈ Monthly |
|---|---|---|
| $10,000 or less | $120 | $10 |
| $10,001–$20,000 | 1% of AGI | $10.00–$16.67 |
| $20,001–$30,000 | 2% of AGI | $33.34–$50.00 |
| $30,001–$40,000 | 3% of AGI | $75.00–$100.00 |
| $40,001–$50,000 | 4% of AGI | $133.34–$166.67 |
| $50,001–$60,000 | 5% of AGI | $208.34–$250.00 |
| $60,001–$70,000 | 6% of AGI | $300.01–$350.00 |
| $70,001–$80,000 | 7% of AGI | $408.34–$466.67 |
| $80,001–$90,000 | 8% of AGI | $533.34–$600.00 |
| $90,001–$100,000 | 9% of AGI | $675.01–$750.00 |
| Over $100,000 | 10% of AGI | $833.34+ |
Each percentage applies to all of AGI in that band (34 CFR 685.209(b)(2)), not only the amount above the band floor. Monthly figures include the $10 floor and exclude the −$50/dependent reduction. Examples: AGI $60,000 → 5% → $250/mo; $100,000 → 9% → $750/mo; $120,000 → 10% → $1,000/mo.
Then two adjustments apply:
- − $50 per dependent off the monthly payment (a dependent = someone you claim on your tax return)
- Floor of $10/month — the payment never goes below this, no matter your income or family size
Married filing jointly? Payment uses your combined AGI. Filing separately? Only your own AGI counts.
Three things RAP does that SAVE didn't
- Waives unpaid interest. If your on-time payment is less than the interest accruing, the government does not charge the difference — your balance never grows (no negative amortization).
- Matching principal payment. When an on-time payment reduces outstanding principal by less than $50, ED reduces principal by the lesser of $50 or that month's payment, minus the principal your payment already covered (34 CFR 685.209(o)(2)). A $10 payment that covers only interest still gets a $10 match, not a flat $50.
- 30-year forgiveness. Any balance left after 360 qualifying payments is forgiven.
Who's eligible — and who must use it
- Any federal Direct Loan borrower can use RAP.
- New loans (first disbursed on/after July 1, 2026): RAP is the only income-driven option. There's no IBR choice.
- Older loans (before July 1, 2026): you choose between RAP and IBR. IBR no longer requires a partial financial hardship to enroll.
- SAVE/PAYE/ICR borrowers: those plans are being phased out. You must transition by July 1, 2028 — or be auto-enrolled in RAP.
RAP frequently asked questions
RAP frequently asked questions
RAP is the brand-new federal income-driven student loan plan for 2026. Here's exactly how it works — payments, eligibility, and the 30-year forgiveness — in plain English.
How this guide was built
Written by the RAP vs IBR editorial team (independent; no named byline published yet). Formulas follow 34 CFR 685.209 and the One Big Beautiful Bill Act (P.L. 119-21) §80503, cross-checked against CRS IF13075. Poverty-line and program details per HHS (91 FR 1797) and Department of Education guidance. Last updated: September 29, 2026. Disclaimer: informational only — not legal, tax, or financial advice, and not official Department of Education guidance.
34 CFR 685.209OBBBA §80503HHS 2026CRS IF13075
Repayment Assistance Plan (RAP):what it is & how it works
RAP is the brand-new federal income-driven student loan plan for 2026. Here's exactly how it works — payments, eligibility, and the 30-year forgiveness — in plain English.