# What is an ICR repayment plan?

Olivia Watson · August 4, 2026

> The ICR plan is the oldest income-driven repayment option, having been introduced in 1994, long before other plans like IBR and PAYE. It's the only...

The ICR plan is the oldest income-driven repayment option, having been introduced in 1994, long before other plans like IBR and PAYE.

It's the only income-driven plan open to all federal direct loan borrowers, including those with Parent PLUS loans or consolidation loans that include Parent PLUS loans.

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The monthly payment under ICR is capped at 20% of the borrower's discretionary income, defined as the difference between their adjusted gross income and 150% of the federal poverty guideline.

The repayment period for ICR is 25 years, after which any remaining balance is forgiven.

This is the longest repayment term among income-driven plans.

Borrowers enrolled in ICR must recertify their income and family size annually to have their monthly payments recalculated.

If a borrower's income increases significantly during the 25-year repayment period, their monthly ICR payment could eventually exceed what they would pay under the standard 10-year repayment plan.

Unlike other income-driven plans, ICR payments can be applied to Parent PLUS loans, which are not eligible for forgiveness under most other plans.

Borrowers with a high debt load relative to their income may find ICR to be more expensive over the life of the loan compared to other income-driven options like PAYE or REPAYE.

The ICR plan uses a unique formula to calculate the monthly payment - the lesser of 20% of discretionary income or the amount the borrower would pay on a 12-year fixed repayment plan, adjusted for their income.

If a borrower leaves the ICR plan, they cannot re-enroll, unlike other income-driven plans that allow re-enrollment.

The ICR plan is the only income-driven option that allows borrowers to make $0 monthly payments if their income is low enough.

Consolidating multiple federal loans into a Direct Consolidation Loan can make a borrower eligible for the ICR plan, even if they were not previously eligible.

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