Federal Grants

4.1 Pell Grant: what it is and who qualifies#

What the Pell Grant is#

The Pell Grant is the largest federal need-based grant program for undergraduate students. It is awarded by the US Department of Education to students with demonstrated financial need, based on FAFSA. Pell does not need to be repaid as long as the student remains enrolled and meets satisfactory academic progress (SAP).

For 2025-26, the maximum Pell Grant is $7,395 per academic year for full-time enrollment. Approximately 6.4 million students received Pell in 2023-24, with average award around $4,800. Pell is the cornerstone of federal aid for low-income and many middle-income families.

How students and parents typically ask this#

• "What is a Pell Grant?"
• "Do I qualify for Pell?"
• "What is the income limit for Pell?"
• "How much is the Pell Grant?"
• "Is Pell automatic if I file FAFSA?"

Eligibility under the simplified Pell formula#

Starting with the 2024-25 FAFSA, Pell eligibility uses a simplified two-track formula:

Maximum Pell automatic for students from households with adjusted gross income at or below 175% of the federal poverty line (or 225% for single-parent households). For a family of 4 in 2024, 175% of poverty is approximately $54,500; 225% is approximately $70,000. Students in qualifying households receive the maximum Pell ($7,395 for 2025-26) without further calculation.

Minimum Pell automatic for students from households with AGI between 175% and 275% of poverty line (or 225% to 325% for single-parent households, or 225% to 400% for families with non-working spouses). Students in this range receive at least the minimum Pell ($740 for 2025-26).

Pell calculated by SAI for students between minimum-Pell automatic and zero-Pell threshold. The actual award is determined by the SAI relative to a Pell-qualifying SAI threshold (approximately $7,395 for 2025-26). A negative SAI yields the maximum award; an SAI close to the threshold yields a smaller award.

Zero Pell for students with SAI above the qualifying threshold (typically AGI above approximately $100,000 for a family of 4, varying by household size and configuration).

Other eligibility requirements#

Beyond the financial need calculation, Pell also requires:

• US citizenship or eligible non-citizen status: US citizens, US nationals, US permanent residents, and a few other categories qualify. DACA recipients, F-1 visa holders, and most other temporary visa holders do NOT qualify for federal aid including Pell.
• High school diploma or GED: Or a recognized homeschool credential. The Ability to Benefit (ATB) pathway allows some students without a diploma to qualify after passing an approved test or completing 6 credit hours.
• Enrollment in an eligible program: Most degree and certificate programs at accredited Title IV institutions qualify. Audited classes do not.
• Satisfactory Academic Progress: After enrollment, the student must maintain GPA and pace-of-completion standards set by the school.
• Not in default on prior federal loans: A defaulted federal loan blocks new Pell eligibility until the default is cured.
• Selective Service registration (males 18-25, with limited exceptions): Required.

Pell at the application#

Pell eligibility is determined automatically when FAFSA is processed. The student does not file a separate application. The FAFSA Submission Summary indicates whether the student is Pell-eligible and at what amount. Schools then disburse Pell as part of the financial aid package.

A common confusion: students see Pell on their aid letter and assume the school is awarding it. Pell is a federal entitlement; the school is the disbursing agent, not the source. Pell awards do not reduce institutional grant aid because they are separately funded.

Quick-reference checklist#

• File FAFSA to determine Pell eligibility (do not assume eligibility or ineligibility)
• Confirm citizenship status meets federal aid requirements
• Maintain SAP for continued Pell eligibility after enrollment
• Confirm Pell appears on each school's aid offer (it should, automatically, if eligible)

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4.2 Pell Grant award amounts and the Lifetime Eligibility Used (LEU) limit#

Annual maximum and minimum#

For award year 2025-26, the maximum Pell is $7,395 per year for full-time enrollment. The minimum scheduled award is $740 per year. The maximum is set annually by Congress through the appropriations process and has risen approximately $300 per year over the past several cycles, though future-year amounts are not guaranteed.

For award year 2026-27, the published maximum has historically been announced by the Department of Education in late spring or early summer of the prior year. Check studentaid.gov for the current published amount.

How students and parents typically ask this#

• "How much is the Pell Grant?"
• "What is the Pell maximum this year?"
• "What if I'm only enrolled part-time?"
• "How long can I get Pell?"
• "What is the Pell lifetime limit?"

Enrollment intensity affects the award#

Pell awards scale with enrollment intensity. The full-time Pell amount is the maximum; part-time students receive prorated amounts:

• Full-time (12+ credit hours per semester for undergraduates): Maximum scheduled award
• Three-quarter time (9-11 credit hours): 75% of scheduled award
• Half-time (6-8 credit hours): 50% of scheduled award
• Less than half-time (1-5 credit hours): 25% of scheduled award

Students enrolled in summer terms can receive additional Pell beyond the standard two-semester schedule (Year-Round Pell, covered in 4.3). The full-time vs part-time determination is made at the start of each enrollment period.

The Lifetime Eligibility Used (LEU) cap#

Each student is limited to a lifetime maximum of 600% Pell, equivalent to 12 full-time semesters. This is the Lifetime Eligibility Used (LEU) cap, and it tracks the cumulative percentage of full-time Pell the student has received across all schools and all enrollment periods.

A student enrolled full-time for 8 semesters has used 400% LEU. A student who has been part-time for some semesters uses LEU at the prorated rate (a half-time semester uses 50% LEU). Once LEU reaches 600%, the student is no longer eligible for Pell, even if otherwise qualified.

LEU is tracked at the National Student Loan Data System (NSLDS) and is visible to students on studentaid.gov. Students approaching the cap should plan carefully, especially if pursuing a graduate degree (Pell is undergraduate-only, so most graduate students do not deplete LEU further).

OBBBA changes for 2026-27#

The One Big Beautiful Bill Act (OBBBA) of 2025 made several changes to Pell that take effect for the 2026-27 award year:

• New "Workforce Pell" for short-term (8-15 week) workforce credentials at participating institutions. Expands Pell to non-degree training programs.
• Refined enrollment intensity calculation that prorates more granularly than the old 25% / 50% / 75% / 100% buckets.
• Updated formulas for Pell-qualifying SAI threshold based on cost of attendance components.

Most of OBBBA's changes are technical and do not change baseline Pell eligibility for most students. But for students considering short-term workforce programs or attending unusual enrollment patterns, the new rules are relevant.

Disbursement timing#

Pell is disbursed by the school, typically once per term. The school credits the student account for tuition and fees; any leftover Pell is refunded to the student to cover indirect costs (books, transportation, off-campus housing). Refunds are usually processed within 14 days of the disbursement date.

For students who withdraw mid-term, the federal Return to Title IV (R2T4) calculation determines how much Pell must be returned to the federal government. The student may owe money back to either the school or the federal government if they withdraw before earning the full Pell award.

Quick-reference checklist#

• Track LEU on studentaid.gov; aim to graduate before exceeding 600%
• Know the Pell-prorating rules if planning part-time enrollment
• If considering a short-term workforce program for 2026-27, check Workforce Pell eligibility
• Understand that mid-term withdrawal triggers R2T4 calculations and possible repayment

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4.3 Year-Round Pell and Summer Pell#

What Year-Round Pell is#

Year-Round Pell allows eligible students to receive up to 150% of their scheduled Pell award in a single award year by enrolling in a third semester (typically summer) on top of fall and spring. The policy was reinstated in 2017-18 to help students accelerate graduation and reduce time-to-degree.

A student receiving the full $7,395 maximum Pell for fall and spring can receive an additional half-Pell ($3,697.50) for summer, totaling up to $11,092.50 for the academic year. This is on top of the standard 600% LEU cap, so it is not unlimited; students using Year-Round Pell deplete their LEU faster.

How students and parents typically ask this#

• "Can I get Pell for summer?"
• "What is Year-Round Pell?"
• "How does Summer Pell work?"
• "Do I have to apply separately for Summer Pell?"
• "Will Summer Pell reduce my regular Pell?"

Eligibility for Year-Round Pell#

To receive a Year-Round Pell summer award, the student must:

• Be Pell-eligible based on FAFSA for the academic year
• Have enrolled at least half-time in fall and spring (otherwise the summer award has different rules)
• Be enrolled at least half-time in the summer term
• Be in good academic standing (SAP)
• Not have already exceeded the 600% LEU lifetime cap

The summer award is calculated based on summer enrollment intensity. A student enrolled full-time in summer can receive up to 50% of their scheduled Pell (the full half-year amount); part-time enrollment is prorated.

How to access Year-Round Pell#

The school's financial aid office handles Year-Round Pell automatically when the student registers for summer classes. No separate FAFSA filing is required; the student's existing FAFSA covers the full award year (fall, spring, and summer).

The student must register for summer classes by the school's deadline, and the financial aid office must process the Year-Round Pell award. Some schools require the student to complete a summer aid application or contact the financial aid office to confirm summer plans.

Strategic considerations#

Year-Round Pell is a real benefit but accelerates LEU consumption. A student using Year-Round Pell every year for 4 years would consume 600% LEU in exactly 4 calendar years (4 academic years x 150% = 600% LEU). A student who needs more than 4 years to graduate (very common, especially in STEM and pre-med tracks) would exceed LEU before completing the degree.

Strategic uses of Year-Round Pell:

• Accelerate graduation by one term, allowing earlier entry to workforce or graduate school
• Take required courses in summer when class size is smaller
• Catch up on credits after a semester of reduced enrollment due to medical or family issues
• Complete an internship-credit or research-credit summer that requires Pell to be financially feasible

Less strategic:

• Using Year-Round Pell for a non-required summer course just because Pell is available
• Using Year-Round Pell when likely to need a fifth year, accelerating LEU exhaustion before graduation

Quick-reference checklist#

• Check eligibility for Year-Round Pell with the school's financial aid office before registering for summer
• Plan LEU usage carefully; Year-Round Pell accelerates LEU consumption by 50%
• Confirm summer enrollment meets the half-time minimum
• Distinguish strategic acceleration from convenience use

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4.4 SEOG (Supplemental Educational Opportunity Grant)#

What SEOG is#

The Federal Supplemental Educational Opportunity Grant (FSEOG, often shortened to SEOG) is a smaller federal grant program for students with exceptional financial need. SEOG awards typically range from $100 to $4,000 per year, with most awards in the $500 to $2,000 range. The program is administered by individual colleges using federal funds allocated to each school.

Unlike Pell, SEOG is not an entitlement. The federal government allocates a fixed pool of SEOG funds to each participating college, and the school distributes those funds to its highest-need students until the pool is exhausted. SEOG is therefore first-come, first-served at the school level.

How students and parents typically ask this#

• "What is SEOG?"
• "How is SEOG different from Pell?"
• "Do I qualify for SEOG?"
• "Why didn't I get SEOG?"
• "Can I get SEOG without Pell?"

Eligibility#

SEOG eligibility requires:

• Filing FAFSA
• Pell Grant eligibility (with rare exceptions)
• Exceptional financial need, generally defined as SAI substantially below the Pell threshold
• US citizenship or eligible non-citizen status
• Enrollment in an undergraduate program at a SEOG-participating school

Most US colleges participate in SEOG; the school's financial aid office can confirm. Schools with larger Pell-eligible populations receive larger SEOG allocations.

Award process#

The school's financial aid office identifies SEOG-eligible students from the pool of FAFSA filers and awards SEOG starting with the highest-need students first. Awards are made until the school's annual SEOG allocation is exhausted, typically by the time aid letters go out for early-filing students.

The practical implication: filing FAFSA early matters for SEOG. A student with high need who files FAFSA in October is much more likely to receive SEOG than the same student filing in March, even though both are equally needy on paper. Late filers often see "no SEOG available" on their aid letter.

Award amounts#

SEOG awards vary widely by school. Schools with substantial Pell populations and large allocations may award SEOG of $500 to $2,000 to most Pell-eligible students. Schools with smaller allocations may award SEOG only to Pell-zero students with the lowest SAI, in amounts as small as $100.

The federal minimum award is $100 per year; the federal maximum is $4,000 per year. Most actual awards fall in the middle of this range. There is no Year-Round SEOG analogous to Year-Round Pell.

SEOG is layered on top of Pell#

A student receiving the full Pell Grant of $7,395 plus SEOG of $1,000 gets $8,395 in total federal grant aid. SEOG does not reduce or replace Pell; the two are stacked. Both count against demonstrated need and the COA cap.

Quick-reference checklist#

• File FAFSA early to maximize SEOG eligibility
• Confirm with each target school whether they participate in SEOG (almost all do)
• Look for SEOG on the aid award letter; if absent at a Pell-eligible school, ask the financial aid office why
• Understand SEOG is school-specific; the same student can receive SEOG at one school and not another

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4.5 TEACH Grant and the service obligation#

What the TEACH Grant is#

The TEACH Grant (Teacher Education Assistance for College and Higher Education) is a federal grant program for students who plan to teach in high-need subject areas at low-income schools after graduation. The grant provides up to $4,000 per year (subject to sequestration adjustments; the actual maximum has been around $3,772 in recent years) for undergraduate or graduate study in eligible teacher preparation programs.

The TEACH Grant has a service obligation: recipients must teach full-time for at least 4 academic years within 8 years of completing or otherwise ceasing enrollment, in a high-need field at a school serving low-income students. Failure to complete the service obligation converts the grant into an unsubsidized federal loan with interest accruing back to the original disbursement date. This conversion is automatic and frequent: roughly two-thirds of TEACH Grant recipients have had their grants converted to loans, often because of paperwork errors rather than failure to teach.

How students and parents typically ask this#

• "What is the TEACH Grant?"
• "Do I have to be an education major to get TEACH?"
• "What if I change my mind about teaching?"
• "What counts as a high-need field for TEACH?"
• "Will my TEACH Grant become a loan?"

Eligibility#

To receive a TEACH Grant:

• File FAFSA
• Be enrolled in a TEACH Grant-eligible program at a participating school (the school's education department can confirm)
• Maintain at least a 3.25 GPA, or score above the 75th percentile on a college admissions test, or pass an ED-approved exit exam
• Sign a TEACH Grant Agreement to Serve (ATS)
• Complete TEACH Grant counseling annually

The grant is available for both undergraduate (up to $16,000 over 4 years) and graduate study (up to $8,000 over 2 years).

High-need fields#

TEACH Grant teaching service must be in a high-need field, defined as:

• Bilingual education and English language acquisition
• Foreign language
• Mathematics
• Reading specialist
• Science
• Special education
• Other fields designated by the federal government, the state, or the local education agency as high-need

The list is updated annually; check the current TEACH Grant high-need field list at studentaid.gov.

Service obligation in detail#

The recipient must complete 4 full academic years of teaching:

• Within 8 years of completing the program for which the grant was awarded
• Full-time (as defined by the state or school where teaching)
• In a high-need field as listed above
• At a low-income school designated by the Department of Education in the Teacher Cancellation Low Income (TCLI) Directory

The 4 years do not need to be consecutive. Time spent teaching in non-qualifying positions does not count.

Recipients must submit annual certification of teaching service to the federal loan servicer (currently MOHELA). Failure to submit certification on time can trigger conversion to a loan even if the recipient is teaching qualifying service.

Conversion to a loan#

If the recipient fails to complete the service obligation, the TEACH Grant converts to a Direct Unsubsidized Loan with interest charged back to the original disbursement date. The total amount owed includes the original grant principal plus accrued interest from the disbursement date through the conversion date, often adding 20-50% to the original amount.

Once converted to a loan, the recipient repays under standard federal loan terms. The loan cannot be reconverted back to a grant, even if the recipient later begins qualifying teaching service.

The conversion rate is approximately 67% of recipients, which has been a longstanding criticism of the program. Common conversion triggers include:

• Failure to submit annual teaching certification on time
• Teaching at a school not in the TCLI Directory (status can change year to year)
• Teaching part-time when the school does not classify the position as full-time
• Teaching outside a high-need field (e.g., elementary general education when only special-ed-elementary qualifies)

Strategic decision: take the TEACH Grant?#

The TEACH Grant is genuinely useful for students who are committed to teaching in high-need fields and have done their research on the service requirements. It is risky for students who are uncertain about their teaching plans or who may want flexibility to teach in non-qualifying schools (suburban districts, private schools, certain charter schools).

A student who would qualify for the TEACH Grant but is uncertain about teaching might instead take Direct Unsubsidized Loans up to the same dollar amount and avoid the conversion risk. The interest cost of the loan is comparable to the conversion penalty if the grant is converted.

Quick-reference checklist#

• Confirm the school's program is TEACH Grant-eligible before counting on this aid
• Understand the service obligation in detail before signing the ATS
• Set calendar reminders for annual teaching certification (this is the most common conversion trigger)
• Plan to teach in a TCLI Directory school in a high-need field for at least 4 years within 8 years of graduation
• If unsure about teaching plans, consider Direct Unsubsidized Loans instead

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4.6 Iraq and Afghanistan Service Grant#

What the IASG is#

The Iraq and Afghanistan Service Grant (IASG) provides federal grant aid to undergraduate students whose parent or guardian was a member of the US Armed Forces and died as a result of service in Iraq or Afghanistan after September 11, 2001. The grant amount equals the maximum Pell award for the year ($7,395 for 2025-26) regardless of the student's calculated SAI.

The IASG was created in 2009 to recognize that surviving family members of fallen service members should not have to navigate need-based aid eligibility to receive substantial federal support for college.

How students and parents typically ask this#

• "What is the Iraq and Afghanistan Service Grant?"
• "Do I qualify for IASG if my parent died in service?"
• "Is IASG separate from Pell?"
• "How much is the IASG?"
• "Do I still need to file FAFSA?"

Eligibility#

To qualify for the IASG, the student must:

• Be the child of a US service member who died as a result of service in Iraq or Afghanistan after September 11, 2001
• Have been under 24 years old or enrolled in college at the time of the parent's death
• Not be Pell-eligible (students who would qualify for Pell automatically receive Pell instead; the IASG is for students who do not qualify for Pell)
• Be a US citizen or eligible non-citizen
• Be enrolled at least half-time in an eligible degree or certificate program

The grant cannot be combined with Pell. Students whose family income makes them Pell-eligible receive Pell. Students whose family income would normally produce zero Pell receive the IASG instead, equal to the maximum Pell amount.

How to apply#

File FAFSA. The school's financial aid office identifies eligible students based on FAFSA data and parent's death record. The Department of Veterans Affairs and the Department of Defense maintain records of qualifying service members; schools verify eligibility through these channels.

Documentation may be requested: a death certificate, military service records, or other verification that the parent's death was service-related in Iraq or Afghanistan.

Quick-reference checklist#

• File FAFSA to be considered for IASG
• Confirm parent's qualifying service through DD-214 or related military records
• Provide death certificate and service records if requested by the financial aid office
• Understand IASG is not combined with Pell; the larger of the two is awarded