Advertiser Disclosure
You're our top priority.
We want you to be able to make decisions about your student loans with confidence. We offer objective, independent, straightforward guidance on student loans and refinancing lenders. While our site doesn't answer every question or have every lender, we are proud to provide the information and tools you need — free of charge — to make the best decisions for yourself. So how do we make money? We get paid in two ways. First, you can hire us to develop a student loan strategy for you and implement that strategy on your behalf. Second, our partners compensate us. This may influence which refinancing lenders we write about, but it doesn't affect our recommendations or advice. Our partners cannot pay us to guarantee favorable reviews of their products or services.Income-Contingent Repayment, or ICR, is the oldest federal income-driven repayment plan. Your payment is the lesser of 20% of your discretionary income or a 12-year fixed amount adjusted for your income, and whatever remains is forgiven after 25 years. ICR is also closing: the plan ends July 1, 2028. A Direct Consolidation Loan that repaid a Parent PLUS loan and was disbursed before July 1, 2026 can use ICR, as long as you take out no new federal student loan. For everyone else, the printed regulation limits enrollment to borrowers already repaying under ICR on July 1, 2024. That limit is disputed, and the Department’s own application does not apply it.
Who Can Still Enroll in ICR
Two rules on ICR enrollment are solid and one is disputed. Take them separately.
Settled — a consolidated Parent PLUS loan opens ICR if the consolidation already exists. A Direct Consolidation Loan that repaid a Parent PLUS loan and was disbursed before July 1, 2026 can use ICR. That route sits in its own provisions and is not part of the dispute below — and ICR is normally a waypoint there rather than the destination, because one payment on ICR is what unlocks Income-Based Repayment.
Settled — new borrowing closes ICR. If you take out a Direct Loan on or after July 1, 2026 — including a new consolidation — you lose access to ICR, along with Income-Based Repayment and Pay As You Earn, across your whole Direct Loan portfolio.
Disputed — the July 1, 2024 enrollment gate. The printed regulation says you may enroll only if you were repaying under ICR on July 1, 2024, and that leaving the plan closes the door behind you. That language was carried forward from a rule a court vacated, and the Department of Education never removed it. Its own guidance and the servicers treat ICR as available. The income-driven repayment request the Department posted around October 1, 2026 (OMB 1845-0102, expiring 08/31/2029) offers ICR with no July 2024 condition. People who took part in the rulemaking say the Department considers the provision dead.
What that means in practice: if you were not on ICR in July 2024 and you do not have a consolidated Parent PLUS loan, do not rule yourself out — apply, and let the Department decide rather than deciding against yourself. But do not build a plan around ICR either. It ends July 1, 2028 regardless, and if you are using it as the Parent PLUS route, the step that matters is getting onto Income-Based Repayment before that date.
If your loans were disbursed before July 1, 2026, Income-Based Repayment remains open to you. The Repayment Assistance Plan is open to most federal loans, but not to a consolidation loan that repaid a Parent PLUS loan.
Why a Consolidated Parent PLUS Loan Has to Start on ICR
A Direct Consolidation Loan that paid off a Parent PLUS loan is barred from every income-driven plan except ICR, so ICR is where it has to start — no July 2024 test required.
Your servicer is not making a mistake. If your consolidation was disbursed on or after July 1, 2025, ICR is the only income-driven plan you are permitted to choose. A denial of Income-Based Repayment on that loan is the rule working as written, not an error or a backlog.
One ICR payment changes the loan’s status. A consolidation loan that paid off a Parent PLUS loan carries a designation that locks it out of the other plans. Making a single payment under ICR removes that designation and opens Income-Based Repayment.
This applies even if you consolidated twice. The older “double consolidation” approach does not skip the ICR step. A consolidation loan that paid off another consolidation loan that paid off a Parent PLUS loan carries the same designation, and needs the same single ICR payment.
The payment window runs through June 30, 2028. The consolidation itself had to be disbursed on or before June 30, 2026, but the ICR payment that unlocks Income-Based Repayment does not face that earlier deadline.
Related:
How Your ICR Payment Is Calculated
Your ICR payment is the lesser of two figures, recalculated every year: You can run both figures on the ICR calculator.
20% of your discretionary income, divided by 12. For ICR, discretionary income means your adjusted gross income minus 100% of the federal poverty guideline for your family size — $15,960 for a single person in the 48 contiguous states in 2026.
A 12-year fixed payment, adjusted by an income factor. This is what you would pay on a 12-year fixed schedule based on what you owed when you entered ICR, multiplied by a percentage tied to your income that the Department of Education publishes each year.
ICR uses the least generous income calculation of any income-driven plan. Every other plan shields more of your income before the percentage applies — Income-Based Repayment and Pay As You Earn protect 150% of the poverty guideline, and the retired SAVE plan protected 225%. ICR protects 100%. That smaller shield, combined with the 20% rate, is why ICR payments generally run higher than Income-Based Repayment for the same borrower.
ICR has no fixed ceiling the way Income-Based Repayment does. Income-Based Repayment stops at the 10-year standard payment amount no matter how much you earn. ICR’s second figure moves with your income rather than stopping, because the income factor rises as income rises. In practice the 12-year-based figure is usually the one that governs, so payments rarely land above that amount — but there is no hard cap holding them there.
ICR also carries no interest subsidy. If your payment does not cover the monthly interest, the unpaid portion is yours. Income-Based Repayment waives unpaid interest on subsidized loans for the first three years; ICR waives nothing.
To see your own numbers, run them through the ICR calculator.
What Forgiveness Looks Like on ICR
ICR forgives whatever remains after 300 qualifying monthly payments — 25 years — and it counts toward Public Service Loan Forgiveness only for payments received on or before June 30, 2028.
The 25-year clock counts more than your time on ICR. Months when your calculated payment was $0 count, and time on Income-Based Repayment and Pay As You Earn carries over, so you may be further along than your time on this plan alone suggests. Months repaid under the Repayment Assistance Plan are the exception — they do not count toward ICR’s clock.
The Public Service Loan Forgiveness deadline is firm. Payments received on or before June 30, 2028 qualify. After that, ICR no longer exists, so continuing toward the 120-payment mark means moving to a plan that still does.
Forgiveness after 25 years is taxable as income under current federal law. Public Service Loan Forgiveness is not.
When Staying on ICR Makes Sense
Two situations make ICR a destination rather than a waypoint: a balance that is low relative to your income, and a position close to the 25-year forgiveness line.
Low balance, high income. The 12-year-based figure is calculated from what you owed when you entered the plan, not from what you earn. If your balance is small relative to your income, that figure can come in below what Income-Based Repayment or Pay As You Earn would charge, because those plans take a percentage of income with no equivalent brake.
Close to the 25-year mark. Within a few years of the forgiveness line, the deciding figure is the total left to pay before the balance clears, not the monthly payment in isolation.
Everyone else. ICR generally costs more per month and forgives later — 25 years against 20 for a newer Income-Based Repayment borrower.
What You Have to Do Before July 1, 2028
ICR ends July 1, 2028. Before that date you have to elect another plan — Income-Based Repayment, the Repayment Assistance Plan, standard, graduated, or extended repayment. What happens if you do nothing depends on your loan type.
If you make no election, you are placed automatically. Loans eligible for the Repayment Assistance Plan go there. Loans that are not eligible for it go to Income-Based Repayment. Either way, you land on a plan you did not pick.
A consolidated Parent PLUS loan goes to Income-Based Repayment only if it has already made its one ICR payment. These loans cannot use the Repayment Assistance Plan at all. A loan that never made that payment before June 30, 2028 does not reach Income-Based Repayment by default; it falls to the Tiered Standard plan. That is why the ICR payment, not the deadline, is the step to protect.
Everyone else has two plans with different ceilings. The Repayment Assistance Plan has no payment cap, while Income-Based Repayment stops at the 10-year standard amount. For a borrower with a low balance and a high income, that ceiling can make Income-Based Repayment the cheaper plan even though the Repayment Assistance Plan applies a lower percentage.
Related:
How to Enroll or Switch Plans
Both entering and leaving ICR run through the same income-driven repayment plan request at StudentAid.gov.
Gather your information. You need your FSA ID, your most recent federal tax return for your adjusted gross income, and your family size.
Submit the income-driven repayment request. Log in at StudentAid.gov and complete the income-driven repayment plan request. You can import your tax information directly.
Confirm the payment posted. If you are making the single ICR payment to open Income-Based Repayment, call your servicer and confirm the payment posted before you submit the next plan request. This is the step that gets missed.
Recertify every year. Your payment is recalculated annually from updated income and family size. If you miss recertification, you stay on ICR, but your payment jumps to what you would owe on a 10-year standard schedule based on your balance when you entered the plan — often a steep increase.
FAQs
Is Income-Contingent Repayment going away?
Yes. ICR ends July 1, 2028 under the One Big Beautiful Bill Act. A Direct Consolidation Loan that paid off a Parent PLUS loan and was disbursed before July 1, 2026 can still enroll. Beyond that, the printed regulation limits enrollment to borrowers who were repaying under ICR on July 1, 2024 — but that language came from a rule a court vacated, the Department of Education never removed it, and the Department’s own application does not apply it. If ICR fits your situation, apply rather than ruling yourself out.
How is ICR different from IBR and the other income-driven plans?
ICR is one of the income-driven repayment (IDR) plans, along with Income-Based Repayment, Pay As You Earn, and the new Repayment Assistance Plan. Compared with Income-Based Repayment, ICR takes 20% of income above 100% of the poverty guideline instead of 10% or 15% above 150%, has no cap at the 10-year standard amount, and forgives after 25 years. For most borrowers Income-Based Repayment costs less each month. Our IBR vs ICR guide compares the two in detail.
Why do I qualify for ICR but not Income-Based Repayment?
Because your loan is a consolidation loan that paid off a Parent PLUS loan. That type of loan is eligible for ICR but locked out of Income-Based Repayment until you make one payment under ICR, which removes that restriction. It can never use the Repayment Assistance Plan.
What is the maximum payment under ICR?
There is no fixed maximum. Your payment is the lesser of 20% of discretionary income or a 12-year fixed amount adjusted by an income factor — and that second figure rises with your income rather than stopping at a set ceiling, unlike Income-Based Repayment's 10-year standard cap.
Is ICR a good plan?
It costs more per month than the other income-driven plans for most borrowers, because it takes 20% of income above 100% of the poverty guideline and offers no interest subsidy. It forgives after 25 years. For a borrower with a low balance and a high income, or one close to the forgiveness line, the math can favor it.
What happens to my payment if my income changes?
You recertify once a year and your payment is recalculated from the updated figures. If your income drops significantly before your recertification date, you can submit updated income documentation to have the payment recalculated sooner.
Do my ICR payments count toward Public Service Loan Forgiveness?
Yes, for payments received on or before June 30, 2028. After that date ICR no longer exists, so you will need to be on another qualifying plan to keep building toward 120 payments.
