RAP Deepens the Marriage Penalty for Federal Student Loans

The Education Department’s Repayment Assistance Plan (RAP) bases monthly payments on adjusted gross income (AGI) and ranges from 1% to 10% of AGI, which can widen the “marriage penalty” for couples who file jointly because combined incomes push payments higher. Filing separately can significantly lower IDR payments for some borrowers, but may reduce tax benefits and increase complexity. The effect is smaller when both spouses have loans. RAP also offers a $50-per-dependent discount, which isn’t double-dipped by separate filers. Standard repayment plans are fixed and not affected by filing status. Advisory tip: enroll in autopay for a 1% interest-rate discount through 2028 if you sign up by September; and note that a 2022 law allows married couples to separate their loans rather than consolidate.