On August 15, 2025, Federal Student Aid released an electronic announcement (ID APP‑25‑23) outlining key updates to the 2026–27 FAFSA form and criteria for Pell Grant eligibility.
This announcement outlines key changes to the 2026–27 Free Application for Federal Student Aid (FAFSA®) form and Federal Pell Grant eligibility criteria, as required by recent statutory changes to the federal student aid programs included in Pub. L. 119-21, known as the One Big Beautiful Bill Act (OBBBA), signed by President Trump on July 4, 2025.
All changes will be implemented with the official launch of the 2026–27 FAFSA form by Oct. 1, 2025.
FAFSA Form Changes
Beginning with the 2026–27 award year, the OBBBA updates the Student Aid Index (SAI) asset calculation to exclude, the following from current net worth of business and farms and should not be reported as assets on the FAFSA form:
- The net worth of a family-owned business with 100 or fewer full-time (or full-time equivalent) employees.
- The net worth of a farms on which the family resides.
- The net worth of a commercial fishing business and related expenses, owned and controlled by a family.
These changes are reflected in the 2026–27 FAFSA form that is currently being beta tested (see APP-25-18).
Pell Grant Eligibility Changes
The OBBBA made the following changes to the Pell Grant eligibility criteria, beginning with the 2026–27 award year:
- The foreign earned income exclusion amount reported on the FAFSA form will be added to the adjusted gross income (AGI) when determining Pell Grant eligibility.
- An applicant with an SAI equal to or greater than twice the maximum Pell Grant award amount for the award year are ineligible for a Pell Grant.
- For the 2026–27 award year, this threshold is $14,790.
- Note, this limit does not apply to students who qualify for a Pell Grant under the Special Rule (dependents of certain deceased servicemembers and Public Safety Officers).
These Pell Grant eligibility changes will be implemented with the official launch of the 2026–27 FAFSA form by Oct. 1, 2025.
Beta testing impact: Some beta testing participants may be impacted by these Pell Grant eligibility changes. The Department will identify and reprocess impacted applications submitted during the beta testing period (August and September) after the changes are implemented.
Finally, we would like to remind the community that any 2026–27 FAFSA forms submitted during the beta period are real submissions and do not need to be resubmitted once the form opens to the general public in October.
Contact Information
- FAFSA form changes: Federal Student Aid Information Center at 1-800-433-3243 (1-800-4 FED AID).
- FAFSA processing: FPS Help Desk at 1-800-330-5947 or by email at [email protected].
SOURCE: (APP-25-23) 2026–27 FAFSA Form and Pell Grant Eligibility Updates