IBR Recertification Form and Steps To Take While Applying IBR Recertification Form: If you are a federal student loan borrower, you will be entitled to an income-driven repayment (IDR) plan. These repayment plans can make it affordable to begin the process of paying off your student loans.
They can also keep you eligible for student loan forgiveness programs. IDR repayment plans set your monthly payment based on a percentage of your income. For this reason, you’re required to recertify your income information every year.
You can recertify your income-based repayment plan with a paper form, but it’s smart to complete the process online as early as possible.
This post will guide you through this process and also tell you all you need to know on how to rectify the Income Base Repayment, also known as the IBR recertification form.
What is Income-Based Repayment?
Federal loan borrowers who cannot afford their loan payments could qualify for IDR plans, which base their monthly payments on a borrower’s discretionary income and family size.
There are four different IDR plans, and IBR is a top alternative for many borrowers. Depending on your income and family size, you could substantially lessen your monthly payments by choosing this repayment plan.
For new borrowers, implying borrowers who took out loans on or after July 1, 2014, your monthly payment under IBR is set at 10% of your discretionary income.
However, your payment will never surpass what it would be under a standard 10-year repayment plan. Your repayment term will be 20 years in length, irrespective of whether your loans were for undergraduate or graduate study.
If you don’t qualify as a new borrower, your payment is capped at 15% of your discretionary earnings, but it will never be more than what your payment would be under a standard repayment plan. Your repayment period will be 25 years.
For IBR, the U.S. Department of Education describes your discretionary income as the difference between your household income and 150% of the poverty guideline for your family size and state.
Let’s say, for instance, that you live in Georgia, are married, have two children, and have an adjusted gross income (AGI) of $50,000 per year. The poverty guideline for your household size and state is $26,200.
First, calculate 150% of the poverty policy—$39,300. Your discretionary revenue is the difference between 150% of the poverty guideline and your AGI, so subtract $39,300 from your AGI to get $10,700.
Repayment Options Under the IDR Plan
If you’re certifying under the IDR plan for the first time, you’ll want to be clear on your repayment plan options. IDR is an umbrella term that houses four types of repayment plan options.
The four student loan repayment options are:
- Income-Based Repayment ( IBR )
- Income-Contingent Repayment (ICR)
- Pay As You Earn (PAYE)
- Revised Pay As You Earn (REPAYE)
IBR Recertification Form
You can recertify Income-Based Repayment and the three other income-driven repayment plans either at studentloans.gov or by sending a paper form to your services. Below is the set information you will need to provide;
- Your family size.
- Your most recent federal income tax return or tax transcript.
- Alternate proof of any taxable income, like pay stubs, if you didn’t file taxes.
- A signed statement explaining your income, if no documentation is available.
Recertifying online is typically faster and easier. Studentloans.gov offers online access to your tax records via the IRS Data Retrieval Tool, shares your request with multiple services (if you have them), and confirms your request via email. Having that digital trail may prove handy if your service provider says it hasn’t received your information.
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Completing IDR Certification Form or the IBR Recertification Form
The form is the same for both initial certification and recertification on the IDR plan.
You can complete this form online or on paper. Take note that if you file the IDR certification form on paper and have multiple student loan servicers, you’ll need to fill out a separate form for each loan servicer. Some loan servicers require a paper application, so call them first to find out. I have carefully highlighted the steps to going about it below;
Step 1: Log into the IDR Certification Application
Find the application for IDR certification on StudentLoans.gov. You’ll choose New Applicant or Returning IDR Applicant. Log in with your Federal Student Aid (FSA) ID and password to get to the form.
You’ll notice you can also use the FSA calculator or switch your current IDR plan from this same page. These aren’t what you use to complete certification or recertification, but they may be helpful for you. You can calculate your payment for each type of plan offered; this way, you can choose the one that’s most affordable for you.
Step 2: Provide Your General Household Information
The first portion of the application asks the reason for your IDR request, whether your employer is a nonprofit or government organization, family size, and marital status.
The reason the form asks about your employer is for student loan forgiveness purposes. Filling out this form alone won’t start you on a student loan forgiveness program; however, an IDR repayment plan is required to qualify for federal student loan forgiveness programs.
If you’re married, you’ll need to answer some more questions about your spouse in the income information part of the application.
Step 3: Verify Your Income
The online application makes it fairly painless to provide your income information. You can use the IRS tax retrieval tool to link your information directly to the application.
Accept the waiver, then link your accounts. When you complete this step, you’ll be temporarily taken away from the studentloan.gov website and then returned.
If any further information is needed about your income, you’ll be contacted.
If you don’t want to use your previous income because it has changed, you can submit proof of income manually. This documentation will usually include:
- The date on any supporting documentation you provide must be no farther back than 90 days from the date you submitted the form.
The income information page will have an extra section if you’re married. You’ll need to specify if you file your taxes jointly or separately from your spouse and if you can provide your spouse’s income information.
Step 4: Select Your IDR Plan if it’s Your First Time Certifying
On the same part of the application where you verified your income, you’ll choose your IDR plan. This is only an option if you’re entering IDR for the first time. If you’re recertifying and want to change your IDR plan, you’ll have to complete a separate form to switch your payments outside of recertification.
FSA has the option to estimate your payments under each plan within the application, but you’ll want to do your research on these ahead of time.
Step 5: Input Your Personal Information
You’ll need to submit your personal information, including your address, email, phone number, and the best time to reach you.
Step 6: Review Your Application
Look over your application and verify that all your information is correct. You can click the appropriate edit button on the right-hand side of this page if you need to change anything.
Step 7: Certify and Sign the IDR Form
Authorize and certify the form. Then press submit.
After you complete the application, continue making your regular payments. You’ll be contacted by your loan servicer if any further information is needed. You’ll be notified. And if you’re switching to IDR for the first time, you’ll receive your new payment schedule as well.
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Your annual recertification deadline will likely align with when you entered your income-driven plan. You must submit everything within 10 days following this deadline.
If you miss your recertification deadline, you can enroll again in your plan or resume making payments based on your income by providing your servicer with updated information. This won’t undo any penalties that have already occurred, though.