Estimate your potential monthly payment under an Income-Based Repayment (IBR) plan for federal student loans.
$
persons
Direct Consolidation, Direct PLUS Loans (excluding PLUS Loans made to a parent)
Direct Subsidized, Direct Unsubsidized, Direct Grad PLUS Loans
REPAYE (now SAVE)
IBR (for loans disbursed before July 1, 2014)
IBR (for loans disbursed on or after July 1, 2014)
PAYE
$
Estimated Monthly IBR Payment:—
Understanding Income-Based Repayment (IBR) Plans
Income-Based Repayment (IBR) plans are designed to make repaying federal student loans more manageable by basing your monthly payment on your income and family size. These plans are part of the U.S. Department of Education's efforts to help borrowers who may be struggling with their loan payments.
The core principle of IBR is that your monthly loan payment should not exceed a certain percentage of your discretionary income. Discretionary income is typically calculated as the difference between your annual income and 150% (for newer IBR plans and PAYE/SAVE) or 100% (for older IBR plans) of the poverty guideline for your family size.
How IBR Payments Are Calculated
The calculation generally follows these steps:
Determine Discretionary Income:
Find the poverty guideline for your state and family size from the Department of Health and Human Services (HHS). This guideline is updated annually.
Calculate 150% (or 100% for older IBR plans) of this poverty guideline.
Subtract this amount from your Adjusted Gross Income (AGI), which is found on your federal tax return. The result is your discretionary income. If your income is less than or equal to the poverty guideline multiplier, your discretionary income is $0.
Calculate the Payment Amount:
Multiply your discretionary income by the IBR percentage. This percentage depends on the type of loan and when it was disbursed.
10% of Discretionary Income: for borrowers on the SAVE plan (formerly REPAYE).
10% of Discretionary Income: for Direct Subsidized, Direct Unsubsidized, Direct Grad PLUS loans, and Direct Consolidation Loans that do not include Parent PLUS loans, if disbursed on or after July 1, 2014.
15% of Discretionary Income: for Direct Consolidation Loans that include Parent PLUS loans, or for Direct Subsidized, Direct Unsubsidized, Direct Grad PLUS loans disbursed before July 1, 2014 (older IBR plans).
Divide the result by 12 to get your estimated monthly payment.
Compare with Standard Repayment: Your IBR payment will never be more than what you would pay under the 10-year Standard Repayment Plan. The loan servicer will calculate this and charge you the lower of the two amounts.
Loan Forgiveness
After making qualifying payments for a certain period (typically 20 or 25 years, depending on the plan and loan type), any remaining balance on your federal student loans may be forgiven. However, you may need to pay income tax on the forgiven amount.
Who Should Consider IBR?
IBR plans are particularly beneficial for borrowers who:
Have high student loan debt relative to their income.
Are experiencing financial hardship or have a low income.
Work in public service (PSLF) but need a lower payment while working towards forgiveness.
Want predictability and a cap on their monthly payments.
It's important to note that enrolling in an IBR plan may mean paying more interest over the life of the loan compared to the Standard Repayment Plan, especially if your income increases significantly over time. You must recertify your income and family size annually to remain on an IBR plan.
function getPovertyLine(familySize, state = 'contiguous') {
// Poverty guidelines from HHS for 2023 (most recent available as of late 2023/early 2024)
// Updated annually. For simplicity, using a static table. Alaska and Hawaii have different guidelines.
// This calculator assumes mainland US (contiguous states).
var povertyGuidelines = {
1: 14580, 2: 19720, 3: 24860, 4: 30000, 5: 35140,
6: 40280, 7: 45420, 8: 50560
};
// For families larger than 8, add $5140 for each additional person in contiguous states.
var base = povertyGuidelines[familySize] || povertyGuidelines[8] + (familySize – 8) * 5140;
return base;
}
function calculateIbrPayment() {
document.getElementById('errorMessage').style.display = 'none';
document.getElementById('result').style.display = 'none';
var annualIncome = parseFloat(document.getElementById('annualIncome').value);
var familySize = parseInt(document.getElementById('familySize').value);
var loanType = document.getElementById('loanType').value;
var paymentPlan = document.getElementById('paymentPlan').value;
var totalLoanBalance = parseFloat(document.getElementById('totalLoanBalance').value);
// Input validation
if (isNaN(annualIncome) || annualIncome < 0 ||
isNaN(familySize) || familySize <= 0 ||
isNaN(totalLoanBalance) || totalLoanBalance < 0) {
document.getElementById('errorMessage').innerText = "Please enter valid positive numbers for income, family size, and loan balance.";
document.getElementById('errorMessage').style.display = 'block';
return;
}
var povertyLine = getPovertyLine(familySize);
var discretionaryIncome;
var IBR_percentage;
var paymentCap; // For the 10-year standard repayment calculation
// Determine IBR percentage and poverty line multiplier based on plan and loan type
if (paymentPlan === 'REPAYE_SAVE') {
discretionaryIncome = Math.max(0, annualIncome – (povertyLine * 1.50));
IBR_percentage = 0.10; // 10% for SAVE
} else if (paymentPlan === 'IBR_old') { // Loans disbursed before July 1, 2014
discretionaryIncome = Math.max(0, annualIncome – (povertyLine * 1.00));
IBR_percentage = 0.15; // 15% for older IBR
} else if (paymentPlan === 'IBR_new') { // Loans disbursed on or after July 1, 2014
discretionaryIncome = Math.max(0, annualIncome – (povertyLine * 1.50));
IBR_percentage = 0.15; // 15% for newer IBR
} else if (paymentPlan === 'PAYE') {
discretionaryIncome = Math.max(0, annualIncome – (povertyLine * 1.50));
IBR_percentage = 0.10; // 10% for PAYE
} else {
document.getElementById('errorMessage').innerText = "Invalid payment plan selected.";
document.getElementById('errorMessage').style.display = 'block';
return;
}
// Calculate the preliminary IBR payment
var preliminaryPayment = discretionaryIncome * IBR_percentage / 12;
// Calculate the payment cap (10-year Standard Repayment Plan)
// This is an approximation as interest rates vary and aren't provided.
// For simplicity, we'll assume a common federal loan interest rate for the cap calculation if not specified.
// A more accurate calculator would ask for average interest rate.
// Let's assume an average of 6% for demonstration purposes for the cap calculation ONLY.
var assumedInterestRateForCap = 0.06; // Example rate for cap calculation
var n = 120; // 10 years * 12 months
paymentCap = (totalLoanBalance * (assumedInterestRateForCap / 12)) / (1 – Math.pow(1 + (assumedInterestRateForCap / 12), -n));
// If total loan balance is 0, cap is 0.
if (totalLoanBalance === 0) {
paymentCap = 0;
}
// The actual IBR payment is the lesser of the preliminary payment and the payment cap
var actualIbrPayment = Math.min(preliminaryPayment, paymentCap);
// Display the results
var formattedPayment = actualIbrPayment.toFixed(2);
document.getElementById('monthlyPaymentResult').innerText = "$" + formattedPayment;
var detailsHtml = `
Calculation Breakdown:
Poverty Guideline for Family Size ${familySize}: $${povertyLine.toLocaleString()}
AGI (Annual Income): $${annualIncome.toLocaleString()}
Discretionary Income Calculation: $${annualIncome.toLocaleString()} – ($${povertyLine.toLocaleString()} * ${paymentPlan === 'IBR_old' ? '1.00' : '1.50'}) = $${discretionaryIncome.toFixed(2)}
Estimated Payment based on IBR Percentage (${(IBR_percentage * 100).toFixed(0)}%): $${(discretionaryIncome * IBR_percentage / 12).toFixed(2)}
Estimated 10-Year Standard Payment (Cap): $${paymentCap.toFixed(2)} (using assumed ${assumedInterestRateForCap*100}% rate)
`;
document.getElementById('resultDetails').innerHTML = detailsHtml;
document.getElementById('result').style.display = 'block';
}