What are the detailed income percentage tiers (breakpoints) used by RAP and how were they set?
Executive summary
The Repayment Assistance Plan (RAP) replaces prior income‑driven models with a tiered schedule that charges a set percentage of adjusted gross income (AGI) that rises with earnings — broadly described in reporting as ranging from about 1% up to a 10% cap for higher earners — but the exact income breakpoints for each percentage are not published in the sources provided here [1]. The change shifts the payment base from “discretionary income” to whole‑AGI tiers and was enacted as part of the FY2025 reconciliation law that created RAP and consolidated IDR options .
1. What RAP’s percentage range looks like in reporting
Multiple consumer and financial outlets summarize RAP as a sliding percentage of AGI that starts very low for the bottom of the income scale and climbs to a maximum of 10% of AGI for those earning at least $100,000 a year, with many write‑ups describing a 1%–10% band overall [1]. Reporting also notes a $10 minimum monthly payment under RAP and describes principal/interest subsidies or matches in some versions of coverage — features that change the effective burden beyond the headline percentage . Congressional summary materials frame RAP as a new IDR option that will be available starting July 1, 2026, and emphasize that it replaces earlier discretionary‑income formulas for future borrowers .
2. What the sources say — and do not say — about the breakpoints
Advocates and outlets give the overall band (roughly 1% to 10%) and point to a key observable breakpoint — the $100,000 AGI level tied to the 10% maximum — but none of the provided sources includes a complete, authoritative table listing each intermediate income tier and its exact percentage at every breakpoint [1]. Several explain payments “scale up across arbitrary income thresholds” and criticize that jumpy behavior, but they stop short of reproducing statutory numeric cutoffs in the documents supplied here . In short: reporting converges on the top and bottom of the scale and the AGI basis, but does not publish a full set of detailed breakpoints in these excerpts [1].
3. How RAP’s tiers were set — statutory origin and stated design choices
RAP was created by P.L. 119‑21 in the FY2025 reconciliation law, which directed a new IDR structure and moved repayment calculations to AGI‑based, tiered percentages instead of the longstanding discretionary‑income formula; that legislative origin explains both the approach and the implementation timeline in the summaries . Reporting and analysis trace the policy rationale to consolidation and simplification claims from proponents and to budgetary aims from lawmakers — critics argue the tiered approach was chosen in part to generate fiscal “savings” used elsewhere in the bill, producing steeper increases for some borrowers .
4. Arguments over the design — why breakpoints matter
Policy analysts at TICAS and others say the choice to scale payments by AGI tiers rather than a uniform discretionary‑income share produces regressive effects and creates cliff effects when borrowers cross income thresholds, which is precisely why the specific breakpoints matter for affordability and predictability . Proponents counter that a simple, AGI‑tiered charge keeps more borrowers engaged with servicers and reduces $0‑payment cases, but that tradeoff depends entirely on where the intermediate thresholds and percentages sit — information that the supplied reporting does not fully enumerate .
5. Practical implications and reporting gaps to watch
Available reporting provides the broad mechanics (AGI basis; ~1%–10% scale; $10 minimum; 10% cap at $100k+) and highlights important policy consequences, but none of the supplied snippets contains an authoritative, itemized list of every income breakpoint and its linked percentage — a critical omission if one needs to calculate exact monthly obligations across incomes [1]. For definitive breakpoints, the implementing guidance from the Education Department or the full statutory/regulatory text would be the primary sources; those precise tables are not reproduced in the sources provided here .