How RAP actually works
The Repayment Assistance Plan is the new income-driven plan created by the One Big Beautiful Bill Act (P.L. 119-21). It went live July 1, 2026, and it works differently from every IDR plan before it. Here's the whole thing with real numbers.
Last reviewed: August 2026
1. Your payment is a slice of your total income — not "discretionary" income
Every older IDR plan first protected a chunk of your income (150%–225% of the poverty line) and charged a percentage of the rest. RAP skips that. It takes a percentage of your entire AGI, but the percentage is smaller and scales with income:
| Your AGI | % of AGI per year | Example monthly payment* |
|---|---|---|
| $10,000 or less | flat $10/mo | $10 |
| $10,001 – $20,000 | 1% | $17 at $20k |
| $20,001 – $30,000 | 2% | $50 at $30k |
| $30,001 – $40,000 | 3% | $100 at $40k |
| $40,001 – $50,000 | 4% | $167 at $50k |
| $50,001 – $60,000 | 5% | $250 at $60k |
| $60,001 – $70,000 | 6% | $350 at $70k |
| $70,001 – $80,000 | 7% | $467 at $80k |
| $80,001 – $90,000 | 8% | $600 at $90k |
| $90,001 – $100,000 | 9% | $750 at $100k |
| Over $100,000 | 10% | $1,000 at $120k |
*Before the dependent deduction. The bracket applies to your whole AGI — earn $61,000 and the 6% rate applies to all of it, not just the part above $60,000. That creates real cliff effects at each $10,000 line.
2. Minus $50 a month per dependent
Each dependent (as claimed on your tax return) knocks a flat $50 off your monthly payment. A single parent with two kids earning $40,000 pays $100 − $100 = $10/month (the floor). This replaces the old system where family size raised your protected-income threshold.
3. The $10 floor — and why it matters
Unlike SAVE, where millions of borrowers had a genuine $0 payment, RAP's minimum is $10/month. There is no $0 payment on RAP, ever. The upside: every one of those $10 payments counts toward forgiveness and PSLF.
4. Your balance can never grow
This is RAP's best feature, and it's two separate subsidies:
- Interest waiver: if your payment doesn't cover the month's interest, the government waives the difference. No negative amortization, no capitalization, no watching a $30k loan become $60k.
- Principal match: if your payment reduces principal by less than $50, the government tops the principal reduction up to $50. On a low payment, that means your balance actually shrinks by up to $600/year even when you're barely paying.
No prior IDR plan did the second one. SAVE waived interest, but your principal could still sit frozen for decades.
5. Forgiveness after 30 years
Whatever is left after 360 qualifying monthly payments is forgiven. That's the catch: it's 10 years longer than new-borrower IBR (240 payments) and 5 years longer than old IBR (300). Time you spent in SAVE's litigation forbearance generally did not count toward forgiveness — check your payment count on StudentAid.gov before you assume anything.
6. Married? Filing separately still shields your spouse's income
If you're married filing jointly, your joint AGI drives the bracket. File separately and only your own AGI counts — same logic as the old plans, but the math differs because RAP has no protected-income floor. Run both scenarios in the calculator before deciding; the tax cost of filing separately sometimes eats the payment savings.
7. Who can enroll
- Anyone with existing Direct Loans can switch to RAP now — including exiting SAVE borrowers.
- For loans first disbursed on or after July 1, 2026, RAP is essentially the only income-driven option going forward.
- RAP counts as a qualifying plan for PSLF.
Worked example
Sarah: AGI $55,000, single, no dependents, $38,000 balance at 5.5%.
- RAP: $55,000 × 5% ÷ 12 = $229/mo. Monthly interest is ~$174, so she pays down ~$55 of principal — above $50, so no match needed. Loan retires in roughly 20 years, well before the 30-year mark.
- IBR (new borrower): ($55,000 − $23,940) × 10% ÷ 12 = $259/mo, forgiveness clock: 20 years.
- Standard: $412/mo, done in 10 years, ~$11,500 total interest.
Lowest payment: RAP. Cheapest lifetime cost: Standard, if she can afford it. That trade-off — cash flow now vs total cost — is the whole decision, and it flips depending on your income, family size, and balance. Run your own numbers →