Two formulas answer the same cash-flow question differently
RAP starts with an AGI band. The payment is $10 when AGI is $10,000 or less; from $10,001 through $100,000, each $10,000 band adds one percentage point; income above $100,000 uses 10%. The annual percentage amount is divided by 12, reduced by $50 for each dependent, and held to a $10 monthly minimum.
The IBR illustration in the calculator starts with discretionary income instead. It subtracts 150% of the applicable federal poverty guideline from AGI, takes 10% of the nonnegative remainder, and divides by 12. Family size affects the protected amount, while RAP dependents create a direct $50 monthly subtraction. Those are related household concepts, but they are not interchangeable inputs.
Because one formula uses bands and the other uses a poverty-guideline allowance, their lines cross. A plan that is lower at one AGI can be higher at another. The comparison also depends on whether the borrower is eligible: existing borrowers may compare RAP and IBR, while loans disbursed on or after July 1, 2026 are limited to RAP or Tiered Standard.
Monthly comparison at three income levels
The table assumes tax year 2026, the 48 contiguous states or District of Columbia, family size two, one dependent, and the calculator's newer-borrower IBR illustration at 10%. Its 2026 poverty guideline for family size two is $21,640, so IBR protects 150% of that amount, or $32,460. The values are generated by the same tested functions used by the interactive calculator.
These are monthly payment illustrations, not universal recommendations. They do not include a changing future income, annual household updates, a different poverty-guideline region, an older-borrower IBR percentage, or account-specific eligibility. A borrower should replace every assumption with current official data before choosing a plan.
| AGI | RAP: one dependent | IBR: family size two | Lower illustrated payment |
|---|---|---|---|
| $25,000 | $10.00 | $0.00 | IBR |
| $55,000 | $179.17 | $187.83 | RAP |
| $120,000 | $950.00 | $729.50 | IBR |
Interest treatment and forgiveness are part of cost
RAP waives unpaid interest each month, so a required payment below the month's interest does not leave that unpaid portion to accumulate under the RAP rule. That protection is distinct from reducing principal. A low payment can still leave a balance for a long time, which is why the RAP timeline extends to 360 qualifying payments.
IBR has a 240- or 300-payment forgiveness horizon, depending on the borrower's applicable category. The calculator displays both timelines because a general article cannot determine the borrower-date facts needed to select one. IBR should not be assumed to have RAP's monthly unpaid-interest waiver; current official account guidance should be used for IBR interest treatment.
For a PSLF-eligible borrower, qualifying RAP and IBR payments can count toward the separate 120-payment requirement. That can make the public-service timeline more relevant than either long-form plan horizon. It does not erase the need to confirm employment, loan, payment, and certification requirements in the official PSLF record.
| Feature | RAP | IBR |
|---|---|---|
| Payment basis | Full AGI at a tier rate, less $50 per dependent | 10% of AGI above 150% FPL in this illustration |
| Monthly floor | $10 | $0 in the calculator formula |
| Unpaid interest | Waived monthly | Check current official IBR guidance |
| Plan forgiveness | 360 qualifying payments | 240 or 300 payments |
| PSLF | Qualifying payments can count | Qualifying payments can count |
Who each formula may favor
IBR can produce the smaller illustrated payment when AGI is below its protected-income amount because the formula reaches zero, while RAP has a $10 floor. RAP may become smaller in a middle-income example when the selected tier and dependent reduction undercut IBR's percentage of discretionary income. At higher income, the 10% RAP rate on full AGI can exceed IBR's 10% calculation after the protected amount.
Those patterns explain the three example rows, but they are not a suitability rule. A household with more dependents changes RAP by $50 each, while a larger family changes IBR through the poverty guideline. A different AGI can move RAP into a different tier. Loan balance and interest rate then affect payoff and total cost even when the required monthly formula stays the same.
Use the calculator to compare Monthly payment, Total cost, and Forgiveness results in that order, then inspect the assumptions. An existing borrower should also confirm the applicable IBR cohort. A borrower with new loans on or after July 1, 2026 should not use the IBR column as an available choice and should compare RAP with Tiered Standard instead.
- Choose the correct disbursement period before comparing plans.
- Enter family size and dependents as separate plan inputs.
- Review interest handling and the relevant forgiveness horizon.
- If pursuing PSLF, compare the official 120-payment count with the calculator's planning view.