Student loans

RAP vs IBR: which is cheaper, by balance and income

RAP vs IBR is a live choice only for loans taken before July 2026 — newer loans get RAP alone — but for those borrowers the two plans differ in every part that matters: the formula, whether the balance can grow, when forgiveness lands, and what it costs in tax when it does. The tables below run both plans on three balances at five incomes, to a taxable forgiveness or a paid-off loan, and flag the cheaper one. Every cell is a full projection: single filer in Texas, 28 years old, income growing 4% a year, 6.5% federal loans taken in 2026, run through age 60 so a 30-year RAP term and its forgiveness tax fall inside the window.

IBR — $167,207 vs $185,840 on $100k at a $75k income

First-year payments $423/mo on RAP and $405/mo on IBR. RAP: paid off at 47. IBR: $76,890 forgiven at 48, tax $17,341. On the first payment neither plan is lower everywhere: RAP's rate steps up at each $10,000 band edge, so scanning single-filer incomes from $30k to $200k in $1,000 steps the lower payment is IBR at $30k–$35k, RAP at $36k–$72k, IBR at $73k–$200k.

How the two plans differ

The rules the engine applies
	RAP	IBR (post-2014 loans)
Payment	1–10% of AGI by $10,000 band, minus $50/mo per dependent, $10/mo minimum	10% of income above 150% of the poverty line ($23,940 for one person), capped at the 10-year standard payment
Balance	Never grows: unpaid interest is waived, and it falls at least $50 a month (the payment, if less)	Grows whenever the payment is below the interest
Forgiveness	After 30 years, taxed as income that year	After 20 years, taxed as income that year
Bracket creep	The $10,000 bands are not inflation-indexed, so raises push the rate up over time	The poverty line is indexed; the payment cap is not
Who can use it	Any federal borrower	Loans taken before July 2026

Payments and lifetime cost, by balance and income

"Lifetime" is every payment plus the tax charged when a balance is forgiven — the IBR figure on a large balance is mostly that tax, because twenty years of payments below the interest leave a balance far bigger than the loan. Where a plan pays the loan off, the cell says at what age.

$50k of loans — cheaper: IBR at $50k, RAP at $75k–$150k

$50k → first-year monthly payment and lifetime cost on each plan (payments + tax on a forgiven balance)
Income	RAP/mo	IBR/mo	RAP lifetime	IBR lifetime	Cheaper
$50k	$160	$197	$88,693 paid off at 47	$81,736 $39,588 forgiven at 48, tax $7,654	IBR $6,956 less
$75k	$423	$405	$71,941 paid off at 38	$75,956 paid off at 40	RAP $4,015 less
$100k	$750	$568	$60,944 paid off at 33	$68,129 paid off at 37	RAP $7,185 less
$125k	$1,042	$568	$57,890 paid off at 32	$68,129 paid off at 37	RAP $10,239 less
$150k	$1,250	$568	$56,428 paid off at 31	$68,129 paid off at 37	RAP $11,700 less

$100k of loans — cheaper: IBR at $50k–$75k, RAP at $100k–$150k

$100k → first-year monthly payment and lifetime cost on each plan (payments + tax on a forgiven balance)
Income	RAP/mo	IBR/mo	RAP lifetime	IBR lifetime	Cheaper
$50k	$160	$197	$201,395 paid off at 56	$108,239 $155,918 forgiven at 48, tax $34,157	IBR $93,156 less
$75k	$423	$405	$185,840 paid off at 47	$167,207 $76,890 forgiven at 48, tax $17,341	IBR $18,633 less
$100k	$750	$634	$151,888 paid off at 40	$174,276 paid off at 44	RAP $22,388 less
$125k	$1,042	$842	$136,529 paid off at 37	$149,033 paid off at 40	RAP $12,504 less
$150k	$1,250	$1,051	$128,891 paid off at 35	$138,287 paid off at 38	RAP $9,397 less

$200k of loans — cheaper: IBR at $50k–$125k, RAP at $150k

$200k → first-year monthly payment and lifetime cost on each plan (payments + tax on a forgiven balance)
Income	RAP/mo	IBR/mo	RAP lifetime	IBR lifetime	Cheaper
$50k	$160	$197	$257,844 $175,886 forgiven at 58, tax $39,543	$171,705 $385,918 forgiven at 48, tax $97,623	IBR $86,139 less
$75k	$423	$405	$412,622 $73,013 forgiven at 58, tax $16,476	$229,662 $310,133 forgiven at 48, tax $79,796	IBR $182,959 less
$100k	$750	$634	$444,612 paid off at 53	$291,648 $227,034 forgiven at 48, tax $58,682	IBR $152,964 less
$125k	$1,042	$842	$399,855 paid off at 48	$346,080 $137,224 forgiven at 48, tax $34,342	IBR $53,774 less
$150k	$1,250	$1,051	$352,046 paid off at 44	$390,067 $12,832 forgiven at 48, tax $3,080	RAP $38,021 less

With PSLF the comparison changes entirely — the discharge is tax-free, so only the payments count — and that version is on best repayment plan for PSLF. The standard plan sits beside both on which repayment plan is best, and the RAP formula by AGI and dependents on the RAP calculator.

Educational comparison, not advice. Figures are one persona — single filer in Texas, 28 years old, income growing 4% a year, 6.5% federal loans taken in 2026, run through age 60 so a 30-year RAP term and its forgiveness tax fall inside the window — run through Coastline's projection engine; a different income path, state, filing status or rate changes them. IBR is modelled on its post-2014 terms (10% of income above 150% of the poverty line, capped at the 10-year standard payment, forgiveness at 20 years); RAP's per-dependent reduction counts children aged 0–23. Repayment rules change often — verify current terms with your servicer and studentaid.gov, and model your own balance in the calculator.

Run this with your real numbers

Run your own balance on RAP and on IBR — the projection shows each year’s payment, the balance, the forgiveness year and the tax on it.

Open the free calculator →

Common questions

Is RAP or IBR better?

It depends on income and balance. On $100k at $75k, IBR is cheaper over the life of the loan ($167,207 vs $185,840, forgiveness tax included). Across the three balances: $50k — cheaper: IBR at $50k, RAP at $75k–$150k; $100k — cheaper: IBR at $50k–$75k, RAP at $100k–$150k; $200k — cheaper: IBR at $50k–$125k, RAP at $150k. IBR is only open to loans taken before July 2026.

Is the RAP payment higher than IBR?

It depends on where the AGI sits in its $10,000 band. RAP charges a band rate on the whole AGI and the rate steps up at each band edge; IBR charges 10% of the part above $23,940. Scanning a single borrower's income from $30k to $200k in $1,000 steps, the lower first payment is IBR at $30k–$35k, RAP at $36k–$72k, IBR at $73k–$200k. At $75k that is RAP $423 vs IBR $405 a month. IBR is also capped at the standard 10-year payment, which is why it never exceeds $1,135 on $100k.

When is the loan forgiven on RAP vs IBR?

RAP after 30 years (2056, age 58 for this persona) and IBR after 20 (2046, age 48); both discharges are taxed as ordinary income in that year. On $200k at $75k that means $73,013 forgiven at 58, tax $16,476 on RAP and $310,133 forgiven at 48, tax $79,796 on IBR. A balance the payments clear earlier is simply paid off, with nothing forgiven.

Can I switch from IBR to RAP?

The projection models each plan from 2026 forward and does not model a mid-course switch; whether a switch is allowed, and what it does to progress already counted, is a question for the servicer and studentaid.gov. The tables show what each plan costs run in full, which is the comparison a switch decision needs.