Legislation introduced on Friday by Sen. Tammy Baldwin (D-WI), co-sponsored by Sen. Tim Kaine (D-VA), would increase the income protection allowances (IPAs) for students in Federal Methodology (FM).
The Working Student Act (S. 2796) would increase the IPAs for the 2015-16 award year to:
Increasing the IPAs would “protect” more income from the FM calculation of available income. All other things being equal, an increase in the IPA would generally lead to a lower expected family contribution (EFC) and possibly an increase in eligibility for Title IV aid. Looked at another way, an increase in the IPA increases the amount of money students can earn without that income being counted as available income.
Senator Tom Harkin’s (D-IA) Higher Education Affordability Act (HEAA), a comprehensive higher education reauthorization bill introduced in June, also proposes increases in the IPAs for students. For some students, the HEAA’s proposed IPAs are higher than those in the Working Student Act. For other students, the proposed IPAs in the Working Student Act are higher.
Both bills retain the current statutory language requiring yearly increases to the IPAs based on the percentage increase in the Consumer Price Index (CPI).
Neither bill proposes any base-level changes to the IPA tables applicable to parents of dependent students, but they would still be subject to the same yearly increases based on the CPI.
Publication Date: 9/17/2014