Married Borrowers Could See Major Changes to Student Loan Payments: What's Happening With IDR Plans

If you or someone you know is paying back federal student loans under an income-driven repayment plan, especially as part of a married household, there are some important changes underway that could affect how monthly payments are calculated. These changes come as part of a broader legal battle involving the U.S. Department of Education and a national teachers union.

Here's what's happening — and what it could mean for your budget.

What Are IDR Plans, and Why Do They Matter?

Income-driven repayment plans are a set of programs that base a borrower's monthly federal student loan payment on their income and family size, rather than the total amount owed. The main plans include Income-Contingent Repayment (ICR), Income-Based Repayment (IBR), Pay As You Earn (PAYE), and Saving on a Valuable Education (SAVE), a newer plan introduced under the Biden administration.

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Borrowers on IDR plans may qualify for student loan forgiveness after 20 or 25 years of payments. These plans are especially useful for borrowers with high debt and relatively modest incomes.

The Confusion Over Married Borrowers

A recent legal filing suggested that the Trump administration intended to change how spousal income is treated under IDR plans. According to Forbes, a Department of Education official stated that, beginning in May, the government would start counting spousal income when calculating monthly payments for married borrowers — even if those borrowers file taxes separately or are separated from their spouse.

That would be a big shift. Under current law, borrowers who file taxes separately can have their payments calculated based solely on their own income. Many married borrowers choose to file separately for this reason, even though it often means losing out on tax deductions.

If the proposed change had gone into effect, many married borrowers might have faced significantly higher payments, on top of higher tax bills.

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A Walk-Back and Temporary Clarity

Just days after the statement raised alarms, the Department of Education reversed course. In an updated court filing on April 15, the agency clarified that for ICR, IBR, and PAYE plans, spousal income will not be included when a borrower files taxes separately or is legally separated.

This reversal means that, at least for now, the rules stay the same: married borrowers who file separately can still qualify for IDR payments based only on their own income. That's a relief for millions who were bracing for a sudden increase in their monthly bills.

Why This Is Still a Developing Story

The situation is unfolding as part of an ongoing lawsuit brought by the American Federation of Teachers. The union sued the Department of Education in March after the agency temporarily shut down the IDR system in response to a court ruling that blocked the SAVE plan.

Although access to IDR applications has been restored, the department has yet to fully resume processing them. A hearing is scheduled soon to determine whether the court will order the department to restart full services.

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What Borrowers Can Do Now

If you're a married borrower on an IDR plan or planning to apply for one, continue to monitor official updates from the Department of Education. Filing taxes separately is still a valid strategy for keeping your student loan payments lower — but keep in mind that policy changes are still possible depending on the outcome of the lawsuit.

In the meantime, stay informed, talk to a student loan advisor if needed, and consider how different tax filing strategies could impact your repayment plan.

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