20 U.S.C. § 1098e: Income-based repayment

The term “excepted PLUS loan” means a loan under section 1078–2 of this title , or a Federal Direct PLUS Loan, that is made, insured, or guaranteed on behalf of a dependent student. a consolidation loan under section 1078–3 of this title , or a Federal Direct Consolidation Loan, if the proceeds of such loan were used to discharge the liability on an excepted PLUS loan; or a consolidation loan under section 1078–3 of this title , or a Federal Direct Consolidation Loan, if the proceeds of such loan were used to discharge the liability on a consolidation loan under section 1078–3 of this title , or a Federal Direct Consolidation Loan described in clause (i). pursuant to the Income Contingent Repayment (ICR) plan in accordance with section 685.209(b) of title 34, Code of Federal Regulations (as in effect on June 30, 2023 ); or pursuant to another income driven repayment plan. the borrower’s, and the borrower’s spouse’s (if applicable), adjusted gross income; exceeds 150 percent of the poverty line applicable to the borrower’s family size as determined under section 9902(2) of title 42 . a borrower of any loan made, insured, or guaranteed under part B or D (other than an excepted PLUS loan or excepted consolidation loan), may elect to have the borrower’s aggregate monthly payment for all such loans not exceed the applicable amount divided by 12; the holder of such a loan shall apply the borrower’s monthly payment under this subsection first toward interest due on the loan, next toward any fees due on the loan, and then toward the principal of the loan; shall, on subsidized loans, be paid by the Secretary for a period of not more than 3 years after the date of the borrower’s election under paragraph (1), except that such period shall not include any period during which the borrower is in deferment due to an economic hardship described in section 1085( o ) of this title; and ends the election to make income-based repayment under this subsection; or begins making payments of not less than the amount specified in paragraph (6)(A); or ends the election to make income-based repayment under this subsection; or begins making payments of not less than the amount specified in paragraph (6)(A); any principal due and not paid under paragraph (2) shall be deferred; the amount of time the borrower makes monthly payments under paragraph (1) may exceed 10 years; the maximum monthly payment required to be paid for all loans made to the borrower under part B or D (other than an excepted PLUS loan or excepted consolidation loan) shall be the standard monthly repayment amount; and the amount of time the borrower is permitted to repay such loans may exceed 10 years; at any time, elected to participate in income-based repayment under paragraph (1); and has made reduced monthly payments under paragraph (1) or paragraph (6); has made monthly payments of not less than the monthly amount calculated under section 1078(b)(9)(A)(i) or 1087e(d)(1)(A) of this title, based on a 10-year repayment period, when the borrower first made the election described in this subsection; has made payments of not less than the payments required under a standard repayment plan under section 1078(b)(9)(A)(i) or 1087e(d)(1)(A) of this title with a repayment period of 10 years; has made payments under an income-contingent repayment plan under section 1087e(d)(1)(D) of this title (as such section was in effect on the day before the date of the repeal of section 1087e(e) of this title ; or has been in deferment due to an economic hardship described in section 1085( o ) of this title; a borrower who is repaying a loan made under part B or D pursuant to income-based repayment may elect, at any time, to terminate repayment pursuant to income-based repayment and repay such loan under the standard repayment plan or the Repayment Assistance Program under section 1087e(q) of this title ; and the special allowance payment to a lender calculated under section 1087–1(b)(2)(I) of this title , when calculated for a loan in repayment under this section, shall be calculated on the principal balance of the loan and on any accrued interest unpaid by the borrower in accordance with this section. The Secretary shall establish procedures for annually determining, in accordance with paragraph (2), the borrower’s eligibility for income-based repayment, including the verification of a borrower’s annual income and the annual amount due on the total amount of loans made, insured, or guaranteed under part B or D (other than an excepted PLUS loan or excepted consolidation loan), and such other procedures as are necessary to effectively implement income-based repayment under this section. The Secretary shall consider, but is not limited to, the procedures established in accordance with section 1087e(e)(1) of this title (as in effect on the day before the date of repeal of subsection (e) of section 1087e of this title ) or in connection with income sensitive repayment schedules under section 1078(b)(9)(A)(iii) of this title or 1078–3(b)(1)(E) of this title. use return information disclosed under section 6103( l )(13) of title 26, pursuant to approval provided under section 1098h of this title , to determine the repayment obligation of the borrower without further action by the borrower; allow the borrower (or the spouse of the borrower), at any time, to opt out of disclosure under such section 6103( l )(13) and instead provide such information as the Secretary may require to determine the repayment obligation of the borrower (or withdraw from the repayment plan under this section or under section 1087e(q) of this title , as the case may be); and provide the borrower with an opportunity to update the return information so disclosed before the determination of the repayment obligation of the borrower. selects, or is required to repay such loan pursuant to, an income-based repayment plan under this section or under section 1087e(q) of this title ; or recertifies income or family size under such plan. In the case of a married borrower who files a separate Federal income tax return, the Secretary shall calculate the amount of the borrower’s income-based repayment under this section solely on the basis of the borrower’s student loan debt and adjusted gross income. subsection (a)(3)(B) shall be applied by substituting “10 percent” for “15 percent”; and subsection (b)(7)(B) shall be applied by substituting “20 years” for “25 years”.