Section 1 Short title
This Act may be cited as the “Make Student Grants Truly Tax-Free Act”.
Make Student Grants Truly Tax-Free Act
A BILL
To amend section 117 of the Internal Revenue Code of 1986 to exclude Federal student aid from taxable gross income.
Sec. 2 Expansion of qualified scholarship exclusion from gross income
by striking “received by an individual as a scholarship” and inserting
“(A) as a scholarship”
by striking the period at the end and inserting a comma, and
by adding at the end the following new subparagraphs:
“(B) through a scholarship or fellowship grant program administered by the Secretary of Education that is based on financial need, including a Federal Pell Grant under section 401 of the Higher Education Act of 1965 (20 U.S.C. 1070a), or
“(C) as an Iraq and Afghanistan Service Grant under section 420R of the Higher Education Act of 1965 (20 U.S.C. 1070h).”
Effective date— The amendments made by this Act shall apply to taxable years beginning after December 31, 2014.