ICR plan: Income-Contingent Repayment
With the ICR plan, 20% of your discretionary income is charged and the rest forgiven after 25 years. ICR closes on or before July 1, 2028.
- Applies to discretionary income at 20%
- 25 yearsuntil it's forgiven
- June 30, 2028. deadline to pick a new plan
- No cap. A payment can exceed the Standard bill
How the ICR plan works
Two amounts get compared, and ICR charges the lower one. One of them is 20% of your discretionary income. The second is a fixed 12-year payment that adjusts to your income. Your RAP or ICR payment can go above the 10-year Standard amount. A big raise can make your bill go up. Any balance left after 25 years gets forgiven.
The reason Parent PLUS borrowers used ICR
ICR accepts direct Loans, plus consolidation loans used to repay parent PLUS loans. Parents had no other income-driven plan to use for years. RAP isn't available for Parent PLUS loans or for consolidation loans that repaid them.
When ICR ends
PAYE and ICR go away by July 1, 2028. Choose a different plan by June 30, 2028 if you hold ICR plan student loans. Your servicer will put you in one if you don't.
Where to go after ICR
Students usually can switch to IBR or RAP. Either one often costs less than ICR. Parents have fewer options. Check the Parent PLUS rules before you switch. Consolidations on or after July 1, 2026 that include parent PLUS loans get only Tiered Standard, and that plan is not PSLF eligible.
| Plan | Payment | Forgiveness |
|---|---|---|
| ICR | Applies to discretionary income at 20% | 25 years |
| IBR (2014 or later) | 10% of discretionary income | 20 years |
| RAP | 1% to 10% of AGI | 30 years |
Guides related to this topic
Common questions
Is the ICR plan going away?
Yes, it is. Both PAYE and ICR go away no later than July 1, 2028.
Which is better, IBR or ICR?
IBR costs less in most cases, and it has a cap. ICR mainly helps parents with no other income-driven plan.
Are parents able to leave ICR for RAP?
RAP isn't an option for Parent PLUS loans or for consolidation loans that repaid them.
Sources: Federal Student Aid, IDR court actions, Federal Student Aid, income-driven plans.