Monthly student loan bills can feel impossible when your salary has not caught up with the balance you borrowed. The Income-Based Repayment (IBR) plan is one of the federal government's income-driven repayment options that rewrites that bill around what you actually earn, not what you originally signed up to pay. This IBR calculator estimates your monthly payment in seconds: enter your loan balance, adjusted gross income, family size, and interest rate, and the engine applies the same formula the U.S. Department of Education uses to set IBR bills.
The number you get back is far smaller than a standard 10-year payment for most early-career borrowers, and it is recalculated every year from your tax return. Use it to plan your budget, compare IBR against PAYE or SAVE, and decide whether you should certify your income this spring.
How to Use
- Enter your Loan Balance — the total outstanding federal student principal you owe today. Include both Direct Subsidized and Unsubsidized loans, and any Federal Family Education Loan (FFEL) or Perkins loans you have consolidated into a Direct Consolidation loan.
- Type your Adjusted Gross Income (AGI) from your most recent 1040. This is the income figure the Department of Education uses, not your take-home pay.
- Set your Family Size — yourself, your spouse if you file jointly, and any legal dependents (children under 18, disabled adult children, or dependent parents) you claim on your tax return.
- Enter the Weighted Average Interest Rate on your loans. You can find this on your studentaid.gov dashboard; it is used only to compute the 10-year standard payment cap.
- Leave Poverty Threshold Percent at 150 unless you are modeling a different plan — modern IBR pegs the exempt slice of income to 150% of the Federal Poverty Guideline.
- Leave Discretionary Income Percent at 10 unless you want to compare against older rules — borrowers who took out loans after July 2014 pay 10% of discretionary income under IBR; older borrowers paid 15%.
The result card breaks out the poverty guideline for your family size, the discretionary income slice, the annual IBR amount, the 10-year standard payment it is capped against, and your final estimated monthly bill.
The IBR Formula
IBR is not a flat percentage of your salary. It is a percentage of the slice of your income that sits above a poverty-defined floor. The official calculation is:
Monthly payment = min( 10% × max(0, AGI − 150% × FPL) ÷ 12, Standard 10-year payment )
Where:
- FPL is the Federal Poverty Guideline for your family size and state of residence (the calculator uses the 48-contiguous-states 2024 table; family of one starts at $15,060 and each additional person adds $5,380).
- Discretionary income is whatever you earn above that floor. If your income is at or below 150% of FPL, your discretionary income is $0 and your IBR payment drops to $0.
- The 10-year standard cap is the payment you would owe on a standard 10-year amortization of the same balance at the same rate. IBR payments are never allowed to exceed that number, which prevents high-earners from getting a larger bill on IBR than they would owe off the plan.
Worked example on a $30,000 loan at 5.0% with a single borrower earning $40,000: the 150%-of-FPL floor is $22,590, so discretionary income is $17,410. Ten percent of that is $1,741 per year, or $145.08 per month. The 10-year standard payment on the same balance is $318.20, so the IBR bill is well below the cap and the actual monthly payment is $145.08 — less than half the standard bill.
Who Qualifies for IBR
IBR is available to Direct Loan and FFEL borrowers with a "partial financial hardship," which means your IBR calculated payment is less than what you would owe under a 10-year standard plan. Most graduate and undergraduate borrowers on federal loans qualify if their debt-to-income ratio is elevated. Parent PLUS loans are not eligible for IBR on their own, but a Direct Consolidation loan that includes Parent PLUS can sometimes enter an income-contingent plan instead. Private student loans are never eligible — IBR and the other IDR plans cover federal loans only.
After 20 or 25 years of qualifying payments (20 years for new borrowers after 2014), any remaining balance is forgiven, and that forgiven amount is currently treated as taxable income in most years.
Examples
Example 1 — A single teacher. A first-year public-school teacher owes $30,000 at 5.0%, earns $40,000, and supports only themselves. The floor is $22,590, discretionary income is $17,410, and the monthly IBR payment is $145.08 — compared with $318.20 on a 10-year plan. On a teacher's salary, that difference funds groceries, rent, and a small emergency fund.
Example 2 — A family of four. A nurse with a spouse and two children owes $50,000 at 5.0% and brings home $60,000 AGI. The family-of-four FPL is $31,200, the 150% floor is $46,800, and discretionary income is $13,200. Ten percent is $1,320 per year, or $110.00 per month — even though the balance is larger, the family-size adjustment cuts the bill dramatically.
Example 3 — A high earner hits the cap. An engineer owes $80,000 at 5.0% and earns $500,000. The uncapped IBR formula would produce a $3,978 monthly bill, but the 10-year standard payment on $80,000 at 5.0% is only $848.52. IBR therefore caps the payment at $848.52 — the plan gives them no benefit, and a standard refinance or the standard plan is the better choice.
Example 4 — A very low income. A borrower earning $20,000 with a family of one owes $30,000. Because $20,000 is below the $22,590 floor, discretionary income is $0 and the monthly IBR payment is $0.00. They still accrue interest, but they are not required to write a check.
FAQ
How is my IBR monthly payment calculated?
Your monthly IBR payment is 10% of your discretionary income, divided by 12. Discretionary income is your AGI minus 150% of the Federal Poverty Guideline for your family size. The result is capped at what you would pay on a standard 10-year repayment plan. This calculator reproduces that formula using the 2024 poverty guidelines.
What is considered discretionary income under IBR?
Discretionary income is the portion of your adjusted gross income that exceeds 150% of the Federal Poverty Guideline for your family size and state. If your AGI is at or below that threshold, your discretionary income is $0 and your IBR payment is $0. It is not the same as "money left after rent" — it is a tax-bracket-style slice defined by federal poverty rules.
Does IBR ever lower my payment to $0?
Yes. If your AGI is at or below 150% of the Federal Poverty Guideline for your family size, your calculated IBR payment is $0. The $0 payment still counts as a qualifying payment toward loan forgiveness under Public Service Loan Forgiveness (PSLF) and IDR forgiveness, and you do not need to make any payments for that year.
How does IBR differ from PAYE, SAVE, and ICR?
IBR, PAYE, and SAVE all peg payments to a percentage of discretionary income, but the percentages and poverty floors differ. SAVE (formerly REPAYE) uses 225% of FPL and 5–10% of discretionary income and is generally the lowest payment for most borrowers. PAYE and post-2014 IBR both use 10% of discretionary income but are capped at the 10-year standard payment. Income-Contingent Repayment (ICR) is the fallback plan for Parent PLUS consolidation loans and uses 20% of discretionary income.
Does IBR qualify for Public Service Loan Forgiveness?
Yes. Any payment you make on IBR while working full-time for a qualifying employer (government, 501(c)(3), or certain non-profits) counts toward the 120 payments required for PSLF. $0 payments on IBR also count, which is why low-income public-sector borrowers often see their balances forgiven tax-free after 10 years.
Are spouses' incomes combined under IBR?
If you file your federal taxes jointly, your combined AGI is used to calculate IBR. If you file separately, only your individual AGI is used, which can lower your payment — but you may lose other tax benefits. The calculator uses a single AGI field, so enter the joint AGI if you file jointly, or your individual AGI if you file separately.
How often is my IBR payment recalculated?
Once a year. You must submit an annual income-recertification (sometimes called the IDR recertification) each year. If you do not recertify on time, your payment can default to a much higher amount and you may lose credit toward forgiveness. Set a calendar reminder for the same month you filed your taxes.
Related Calculators
- Student Loan Calculator — run the standard amortization on your full balance.
- Student Loan Payment Calculator — compare fixed monthly bills across repayment plans.
- Student Loan Refinance Calculator — see how a private refi changes interest and monthly cost.
- Student Loan Forgiveness Calculator — project the tax-on-forgiveness bill under PSLF and IDR.
Disclaimer
This IBR calculator is provided for informational purposes only and is not medical advice, nor does it constitute financial, legal, tax, or loan counseling advice. Estimates use the 2024 Federal Poverty Guidelines and post-2014 IBR rules; actual payments are determined by the U.S. Department of Education and your loan servicer and may differ based on your state of residence, loan origination date, loan types, and tax filing status. Always confirm your enrollment and payment amount directly with your federal loan servicer at studentaid.gov before making financial decisions. For our editorial standards see the About page, and for data handling see the Privacy Policy.