AID Act
Summary
What This Bill Does
The AID Act changes how parental student loan debt affects the student aid index for dependent students. Beginning with award year 2027-2028, the Higher Education Act income component for parents includes a student loan allowance. The allowance equals the lesser of $4,000 or 15 percent of a single parent's outstanding federal student loan debt or married parents' combined outstanding federal student loan debt. Parents with adjusted gross income above $200,000, or married parents above $400,000, cannot receive the allowance. Outstanding student loan debt means principal, interest, and fees owed on federal student loans as of the allowance determination date. Beginning in award year 2028-2029, the Education Secretary must publish a revised table of student loan allowances in the Federal Register. Beginning July 1, 2028 and annually thereafter, the Secretary must report to Congress on the number and percentage of dependent students whose aid-index computations included the allowance, disaggregated by Pell Grant eligibility, and the average allowance amount.
Who Benefits and How
Dependent students whose parents still owe federal student loans, families with intergenerational student debt, Pell-eligible students, non-Pell students with indebted parents, financial aid administrators, and colleges serving debt-burdened families benefit because the aid-index formula recognizes parental federal student loan obligations up to a capped amount. Some students may qualify for more need-based aid if the allowance lowers parent income used in the formula.
Who Bears the Burden and How
The Education Department, FAFSA systems staff, financial aid offices, parents reporting federal loan debt, student loan servicers, and congressional reporting staff must update formulas, tables, data collection, verification, Federal Register notices, Pell/non-Pell reporting, and annual reports. Higher-income parents above the $200,000 or $400,000 thresholds receive no allowance. Federal student aid budgets may face higher costs if more students qualify for need-based aid.
Key Provisions
- Adds a parental student loan allowance to dependent-student aid-index calculations beginning in award year 2027-2028.
- Caps the allowance at the lesser of $4,000 or 15 percent of qualifying parental federal student loan debt.
- Denies the allowance to single parents above $200,000 of adjusted gross income.
- Denies the allowance to married parents above $400,000 of combined adjusted gross income.
- Requires annual revised allowance tables in the Federal Register beginning in award year 2028-2029.
- Requires annual congressional reports on affected dependent students, Pell status, and average allowance amounts.
Evidence Chain:
This summary is generated from the full bill text using AI analysis. Expand "Detailed Analysis" below for identified beneficiaries/burden bearers with clause-level evidence links.
At a Glance
What This Bill Does
Adds a student loan allowance to dependent-student aid-index calculations beginning in award year 2027-2028, equal to the lesser of $4,000 or 15 percent of a single parent's federal student loan debt or married parents' combined debt, denies the allowance above $200,000 or $400,000 of adjusted gross income, requires annual inflation-adjusted allowance tables beginning in award year 2028-2029, and requires annual Education Department reports to Congress starting July 1, 2028 on Pell and non-Pell students affected and average allowance amounts.
Key Policy Areas
Education, Financial Services, Tax
Primary Purpose
Adds a student loan allowance to dependent-student aid-index calculations beginning in award year 2027-2028, equal to the lesser of $4,000 or 15 percent of a single parent's federal student loan debt or married parents' combined debt, denies the allowance above $200,000 or $400,000 of adjusted gross income, requires annual inflation-adjusted allowance tables beginning in award year 2028-2029, and requires annual Education Department reports to Congress starting July 1, 2028 on Pell and non-Pell students affected and average allowance amounts.
Policy Domains
Substantive provisions
Identified Gains
- Dependent students
- Parents with federal student loan debt
- Pell-eligible students
- Financial aid administrators
- Colleges serving debt-burdened families
Identified Costs
- Education Department staff
- FAFSA systems staff
- Financial aid offices
- Parents reporting loan debt
- Student loan servicers
- Federal student aid budgets
Legislative Progress
In CommitteeReferred to the House Committee on Education and Workforce.
Introduced in House
Ms. Stevens introduced the following bill; which was referred to …
Stakeholder Effects
cui bono?How this legislation distributes effects. Mention counts reflect frequency, not effect magnitude.
Dependent students, Federal student aid budgets, Financial aid administrators
Positive-direction: Dependent students, Pell-eligible students
Negative-direction: Federal student aid budgets, Financial aid administrators
Congressional education committees, Education Department reporting staff, Education Department staff
Positive-direction: Congressional education committees
Negative-direction: Education Department reporting staff, Education Department staff
Bill Structure & Actor Mappings
Who is "The Secretary" in each section?
We use a combination of our own taxonomy and classification in addition to large language models to assess meaning and potential beneficiaries. High confidence means strong textual evidence. Always verify with the original bill text.
Learn more about our methodology