FAFSA & Financial Aid Eligiblity Changes
The Free Application for Federal Student Aid (FAFSA) is required for Federal aid eligiblity consideration.
Working Families Tax Cut Act (also known as the One Big Beautiful Bill Act) was signed into law on July 4, 2025. For students, families, and institutions like Edmonds College, this bill is significant because it changes some rules related to the federal aid (Title IV) programs. For example, the bill:
As of the development of this webpage, these changes are scheduled to go into effect July 1, 2026, and/or with the 2026-27 Free Application for Federal Student.
FAFSA Changes Effective July 1, 2026
- Family farms and family-owned small businesses will no longer be counted as assets (reverting to rules before FAFSA Simplification)
- Family Farm – Farms on which the family resides
- Small Business – 100 or fewer full-time (or full-time equivalent) employees
- Family-owned commercial fisheries are now also exempt from asset reporting
Foreign Income Reporting
- Foreign income must now be included in the Adjusted Gross Income (AGI) for Pell Grant eligibility
Removes the need for financial aid staff to decide whether foreign income affects
Pell Grant eligibility.
Pell Grants & Full Scholarships
- Students whose Cost of Attendance (COA) is fully covered by non-federal aid will no longer be eligible for a Federal Pell Grant.
Ends the previous allowance for Pell Grants to exceed COA when combined with other
aid
- Example: A Pell-eligible student with a scholarship covering the full Cost of Attendance will no longer receive both the scholarship and the Pell Grant
Pell Grants & High Student Aid Index (SAI)
- Students with an SAI greater than twice the maximum Pell Grant amount will be ineligible for any Pell Grant
- Example: If the max Pell Grant is $7,395, students with an SAI over $14,790 will not qualify