Tax-Free Pell Grant Act

This bill makes Federal Pell Grants tax-free for students. It amends the tax code to exclude Pell Grants from taxable income, meaning recipients won't pay federal income tax on these funds. The change applies to Pell Grants awarded under the Higher Education Act of 1965, as long as they're used for qualified education expenses like tuition. The policy change takes effect for tax years beginning after December 31, 2022.