Senate Committee Reviews Bill to Make Pell Grants Tax-Free Starting in 2026
A senate committee must act next: committee consideration.
No action since May 2025
This bill’s path across every version that has carried it.
How this policy affects specific groups of people
Read twice and referred to the Committee on Finance.
Sent to a congressional committee for expert review. The committee decides whether this bill moves forward.
Introduced in Senate
The bill was officially filed and given a number. It now enters the legislative queue.
A bipartisan coalition introduced the Tax-Free Pell Grant Act to make leftover Pell Grant funds used for living expenses tax-exempt. The bill would also allow recipients to make full use of the American Opportunity Tax Credit (AOTC) without deductions for Pell funds.
A bipartisan group of senators reintroduced the Tax-Free Pell Grant Act, a top priority for community colleges. The measure would shield students from paying taxes on Pell Grant portions used for books and living expenses and enable them to qualify for the $2,500 AOTC.
The House-passed reconciliation bill did not include the bipartisan Tax-Free Pell Grant Act. Advocates are now pushing for its inclusion in the Senate version to fix the tax treatment of Pell Grants and improve AOTC eligibility for low-income students.
No votes or related bills recorded for this bill yet.
Document Type
Congressional Bill
Official Title
Tax-Free Pell Grant Act
Analysis generated by AI. Always verify with official sources.