What Are the Income Guidelines for TAP & Pell Grants?

Grants can help offset the high cost of college education especially for low and moderate-income families with little money available to pay for tuition. Instead of borrowing money to pay for college via students loans and credit cards, students can apply for a TAP or Pell Grant. These grants help to pay for college expenses without the concern of repaying the grants back after graduating from college.

New York State TAP Grants

The New York State TAP Grant is a tuition assistance program conducted by the State of New York. Students who accept the grant must use the money to attend an approved school located in the state. On the other hand, the Pell Grant is a federal grant available to all low-income undergrads in all states to help pay for college tuition and other expenses associated with attending school including transportation, books and supplies. Neither of these two grants requires repayment.

TAP Guidelines for Income Requirements

TAP income requirements depend on whether the student is a dependent or independent and whether or not the students has their own dependents. According to the Borough of Manhattan Community College located in New York City, dependent students and independent students with dependents qualify for TAP with a taxable net household income below $80,001. Independent students who are married but have no dependents qualify with income below $40,000 and single independent students with no dependents only qualify for TAP with an annual income below $10,001.

Pell Grant Rules and Regulations

The Pell Grant rules and regulations for the income criteria are more complex than those of a Tap Grant. Pell takes into account household size, assets, income, the number of students in a household enrolled in college and other variables. Students applying for a Pell Grant must complete the Free Application for Federal Student Aid (FAFSA). The U.S. Department of Education inputs this information into a congressional formula to determine each student’s estimated family contribution or EFC. Students with the lowest EFC determinations receive the most federal aid and those with higher EFCs receive less or no financial assistance. However, while students filling out the FAFSA with higher EFCs may not be eligible for Pell or TAP grants under a need-based designation, they fill out FAFSA to be considered for college merit-based scholarships.

Other Criteria for TAP and Pell Grants

Both TAP Grants and Pell Grants are only awarded to legal U.S. residents. TAP Grant applicants must also reside in New York. TAP guidelines require that students have a high school diploma or equivalency, be enrolled in college for at least 12 credit hours per semester, have at least $200 in tuition bills and maintain a “C” average. Additionally, TAP requires each student receiving a grant to declare a major between their sophomore and junior year, depending on whether or not the student chooses a two-year or four-year study program. Pell Grants, have requirements that are more lenient for students. The Pell Grant rules and regulations do not require a declared major but is only available for up to 18 semesters in a lifetime or until students graduate with a four-year degree. There are also no academic requirements for a Pell Grant. Students who drop a course paid for by a Pell Grant may be responsible for reimbursing the U.S. Department of Education for a portion of the grant money.

Alternative Financial Aid Options

College students ineligible for TAP or Pell Grants may instead find tuition assistance through federal and state tax credits and deductions. Tax deductions reduce each student’s amount of taxable income while tax credits directly lower the amount of tax due. For example, New York offers both a tuition credit and deduction. The tuition credit is worth up to $400 and the tuition provides a maximum deduction of $10,000. Credit and deduction amounts depend on the out-of-pocket costs incurred for tuition and both are only applicable to New York State taxes and not federal taxes. The federal government also offers two tax credits to students. The first is the American Opportunity Credit which is a credit of up to $2,500 available to low and middle-income households for the first four years of college attendance. Similarly, the Lifetime Learning Credit helps reimburse students with a portion of college tuition expenses through a tax credit worth up to $2,000 per year. However, unlike the American Opportunity Credit, there is no limit to the number of years a student may claim the Lifetime Learning Credit.