Discretionary Income Calculator
Calculate the income figure your student loan payment is actually based on. Discretionary income is your AGI minus a protected multiple of the poverty guideline — 150% for IBR and the other income-driven plans, 100% for ICR — and this calculator works both definitions from the 2026 HHS table, then shows what 10%, 15%, or 20% of the result means each month. This is an estimate, not a servicer calculation.
Calculate discretionary income from adjusted gross income, family size, and the 2026 poverty guidelines under both the 150% income-driven definition and the 100% ICR definition, and see the monthly amounts at the 10%, 15%, and 20% plan rates.
Your numbers appear here
Enter your AGI, family size, and state, and your discretionary income shows up in this panel under both definitions the plans use.
You will also see what 10%, 15%, and 20% of it come to each month — the rates New IBR, Old IBR, and ICR apply.
How the Calculator Works
The formula is short: discretionary income = AGI − (poverty guideline × the plan's multiplier), floored at $0 (34 C.F.R. § 685.209(b)(4)). The guideline comes from the HHS table for your family size and state, and the multiplier is the only thing that differs between plans — IBR, PAYE, and the other legacy income-driven plans protect 150% of the guideline, while ICR protects just 100%.
A worked example. A family of three in the contiguous states has a 2026 poverty guideline of $27,320. On a $60,000 AGI, the IBR definition protects 150% of that — $40,980 — leaving $19,020 of discretionary income. ICR protects only the guideline itself, leaving $32,680. Same income, same family, and ICR counts $13,660 more of it as available to pay. That multiplier gap is most of the reason ICR usually costs more than IBR.
For what the figure means and why the plans define it this way, read the guide on how to calculate discretionary income. This page is the tool; that page is the explainer.
10%, 15%, or 20% — Which Rate Applies to You
Once you have your discretionary income, each plan applies its own percentage, and the calculator shows all three monthly figures:
10% of discretionary income — New IBR, for borrowers who first borrowed on or after July 1, 2014. PAYE, where a legacy borrower still has access to it, uses the same 10%.
15% of discretionary income — Old IBR, for borrowers who first borrowed before that date.
20% of discretionary income — one prong of ICR's lesser-of formula, measured against the smaller 100% deduction. ICR compares it with a 12-year fixed amount times a published factor and charges whichever is less.
Two caveats keep these honest. The IBR figures are the income side of the formula only — IBR also caps your payment at the 10-year Standard amount, which needs your balance and rate; run the IBR calculator for the full estimate. And the ICR figure is only one of that plan's two prongs; the ICR calculator models both.
2026 Discretionary Income Chart
The protected amounts below are built from the 2026 HHS poverty guidelines for the 48 contiguous states and DC ($15,960 for one person, plus $5,680 per additional person). Income above the protected amount is discretionary; income below it is not counted. Each row reads: family size — 150% protected (IBR) / 100% protected (ICR).
1 — $23,940 / $15,960
2 — $32,460 / $21,640
3 — $40,980 / $27,320
4 — $49,500 / $33,000
5 — $58,020 / $38,680
6 — $66,540 / $44,360
7 — $75,060 / $50,040
8 — $83,580 / $55,720
Alaska and Hawaii use higher guideline tables — the calculator applies them when you choose your state, and can show the same chart for either. If your AGI is below the 150% figure for your family size, your discretionary income under IBR is $0, and so is a payment calculated on it.
Why RAP Doesn't Use Discretionary Income
The Repayment Assistance Plan — the plan most borrowers with post-July-2026 loans end up on — breaks from every plan before it: there is no discretionary-income step in the RAP formula at all. RAP charges a banded percentage of your whole AGI, from 1% to 10%, stepping up at every $10,000 of income (34 C.F.R. § 685.209(b)(2)), and then subtracts $50 a month per dependent.
That changes the strategy. Under IBR, lowering your AGI only saves you the plan's percentage of the reduction. Under RAP, crossing a $10,000 band boundary downward changes the rate applied to all of your income, so a modest pre-tax contribution can move the payment far more than the contribution itself. Nothing this page calculates carries over to RAP — use the RAP calculator, or compare the plans directly with the IBR vs. RAP calculator.
Sources and Limitations
The definitions are 34 C.F.R. § 685.209(b)(4) — 150% of the poverty guideline for the income-driven plans, 100% for ICR at (b)(4)(iii), floored at $0 — and the poverty guidelines are the 2026 HHS figures at 91 Fed. Reg. 1797, which HHS republishes each January.
This calculator computes the income figure the plans start from; it does not compute a full payment, retrieve tax or loan records, decide plan eligibility, or replace a servicer calculation. Confirm any result with the Federal Student Aid Loan Simulator and your servicer.
Discretionary Income Calculator FAQs
It subtracts a protected amount from your adjusted gross income. For IBR and the other income-driven plans the protected amount is 150% of the HHS poverty guideline for your family size and state; for ICR it is 100%. Whatever is left is your discretionary income, and it never goes below $0. The calculator runs both definitions from the 2026 guidelines at once so you can see how much the multiplier matters.
It is the annual income charge under New IBR — the version for borrowers who first borrowed on or after July 1, 2014 — and under PAYE. Divide by 12 for the monthly figure. This calculator shows that number for your inputs, but remember IBR also caps the payment at the 10-year Standard amount, so the dedicated IBR calculator gives the full estimate.
It is the Old IBR rate, for borrowers who first borrowed before July 1, 2014. On the same income, Old IBR charges half again what New IBR charges — the calculator shows both monthly figures side by side so the difference is visible in dollars rather than percentages.
Yes. The IBR calculation starts from exactly this figure: AGI minus 150% of the poverty guideline (34 CFR 685.209(b)(4)). The IBR calculator then applies the 10% or 15% rate and checks the 10-year Standard cap. If your question is what your IBR payment would be, run this number through the IBR calculator.
The chart on this page lists the 2026 protected-income amounts for family sizes one through eight under both definitions, built from the HHS poverty guidelines published at 91 FR 1797. After you calculate, the tool can also show the chart for Alaska or Hawaii, which use higher guideline tables.
It means your AGI does not exceed the protected amount, so an income-driven payment calculated on discretionary income would be $0. The regulation defines discretionary income as the greater of $0 or AGI minus the protected amount, so it never goes negative — there is no such thing as negative discretionary income on a servicer's worksheet.
No. The Repayment Assistance Plan charges a banded percentage of your whole AGI — from 1% to 10%, stepping at every $10,000 of income — and then subtracts $50 a month per dependent. There is no poverty-guideline deduction anywhere in the RAP formula, so the figures on this page do not carry over. Use the RAP calculator for that plan.
The inputs are AGI and family size, so the levers are the things that lower the AGI your servicer reads — pre-tax retirement and HSA contributions are the common ones — and correctly counting everyone in your family size. How well an AGI reduction pays off is plan-dependent, and the timing has to line up with the income your servicer will actually see. The how-to-calculate guide covers the mechanics.
Articles
