Tax-Free Pell Grant Act

This bill makes Federal Pell Grants tax-free for students. It amends the tax code to exclude Pell Grants used for tuition and related expenses from taxable income, directly affecting undergraduate and graduate students receiving these grants. The key provision ensures Pell Grants are treated like other scholarships for tax purposes, preventing them from being counted as income. The change applies to tax returns filed for 2026 and later.