AID Act

Key Points

• Starting in the 2027-2028 school aid year, some families can subtract a “student loan allowance” from parents’ income when student aid is calculated.
• The allowance is the smaller of $4,000 or 15% of the parent’s federal student loan balance (combined balance for married parents).
• Higher-income families would be excluded: over $200,000 income for a single parent or over $400,000 combined income for married parents.
• This change mainly affects dependent students whose aid is based on their parents’ finances, and it could make some students look “needier” and qualify for more aid.
• The Education Department must report to Congress by July 1, 2028, and yearly after, on how many students used the allowance and the average amount.