Short title; reference

(a)

Short title

This Act may be cited as the

College Aid Made EZ Act

. (b)

References

Except as otherwise expressly provided, whenever in this Act an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of the Higher Education Act of 1965 (20 U.S.C. 1001 et seq.).

Expanding the auto-zero and further simplifying the simplified needs test

(a)

Simplified needs test

Section 479 (20 U.S.C. 1087ss) is amended— (1)in subsection (b)— (A)in paragraph (1)— (i)by striking clause (i) of subparagraph (A) and inserting the following:

(i)the student’s parents— (I)file, or are eligible to file, a form described in paragraph (3); or (II)certify that they are not required to file an income tax return; or (III)or the student received benefits at some time during the previous 12-month period under a means-tested Federal benefit program as defined under subsection (d); and

; and

(ii)by striking clause (i) of subparagraph (B) and inserting the following:

(i)the student (and the student’s spouse, if any)— (I)files, or is eligible to file, a form described in paragraph (3); or (II)certifies that the student (and the student’s spouse, if any) is not required to file an income tax return; or (III)received benefits at some time during the previous 12-month period under a means-tested Federal benefit program as defined under subsection (d); and

; and

(B)in paragraph (3), by striking A student or family files a form described in this subsection, or subsection (c), as the case may be, if the student or family, respectively, files and inserting In the case of an independent student, the student, or in the case of a dependent student, the parent, files a form described in this subsection, or subsection (c), as the case may be, if the student or parent, as appropriate, files; (2)in subsection (c)— (A)in paragraph (1), by striking subparagraphs (A) and (B) and inserting the following:

(A)the student’s parents— (i)file, or are eligible to file, a form described in subsection (b)(3); or (ii)certify that they are not required to file an income tax return; or (iii)or the student received benefits at some time during the previous 12-month period under a means-tested Federal benefit program as defined under subsection (d); and (B)the sum of the adjusted gross income of the parents is less than or equal to $25,000; or

; and

(B)in paragraph (2), by striking subparagraphs (A) and (B) and inserting the following:

(A)the student (and the student’s spouse, if any)— (i)files, or is eligible to file, a form described in subsection (b)(3); or (ii)certifies that the student (and the student’s spouse, if any) is not required to file an income tax return; or (iii)received benefits at some time during the previous 12-month period under a means-tested Federal benefit program as defined under subsection (d); and (B)the sum of the adjusted gross income of the student and spouse (if appropriate) is less than or equal to $25,000.

; and

(C)by inserting after the last sentence of such subsection the following: The Secretary shall annually adjust the income level necessary to qualify an applicant for the zero expected family contribution under this subsection. The income level shall be adjusted according to increases in the Consumer Price Index, as specified in section 478(f).; and (3)by adding at the end the following new subsections:

(d)

Means-tested federal benefit program

For the purposes of this section, the term means-tested Federal benefit program means a mandatory spending program of the Federal Government in which eligibility for the program’s benefits, or the amount of such benefits, or both, are determined on the basis of income or resources of the individual or family seeking the benefit, and includes the supplemental security income program under title XVI of the Social Security Act, the food stamp program under the Food Stamp Act of 1977, the free and reduced price school lunch program established under the Richard B. Russell National School Lunch Act, the temporary assistance to needy families program established under part A of title IV of the Social Security Act, and the women, infants and children program established under Section 17 of the Child Nutrition Act of 1966. (e)

Reporting requirements

The Secretary shall regularly evaluate the impact of the eligibility guidelines in subsections (b)(1)(A)(i), (b)(1)(B)(i), (c)(1)(A) and (c)(2)(A) of this section. In particular, the Secretary shall evaluate whether the means-tested Federal benefit programs (as defined by subsection (d)) ensure that the Simplified Needs Test continues to be targeted to the maximum number of low- and moderate-income students.

Improvements to paper and electronic forms

(a)

Common financial aid form development and processing

Section 483 (20 U.S.C. 1090) is amended— (1)in subsection (a)— (A)by striking paragraphs (1), (2), and (5); (B)by redesignating paragraphs (3), (4), (6), and (7), as paragraphs (9), (10), (11), and (12), respectively; (C)by inserting before paragraph (9), as redesignated by subparagraph (B), the following:

(1)

In general

The Secretary, in cooperation with representatives of agencies and organizations involved in student financial assistance, shall produce, distribute, and process free of charge common financial reporting forms as described in this subsection to be used for application and reapplication to determine the need and eligibility of a student for financial assistance under parts A through E (other than subpart 4 of part A). These forms shall be made available to applicants in both paper and electronic formats and shall be referred to as the Free Application for Federal Student Aid or the FAFSA . (2)

Early estimates

The Secretary shall permit applicants to complete such forms as described in this subsection in the years prior to enrollment in order to obtain an estimate of the family contribution, as defined by section 473. Such applicants shall be permitted to update information submitted on forms described in this subsection using the process required under paragraph (5)(A). (3)

Paper format

(A)

In general

The Secretary shall produce, distribute, and process common forms in paper format to meet the requirements of paragraph (1). The Secretary shall develop a common paper form for applicants who do not meet the requirements of subparagraph (B). (B)

Ez fafsa

(i)

In general

The Secretary shall develop and use a simplified paper application form, to be known as the EZ FAFSA, to be used for applicants meeting the requirements of section 479(c). (ii)

Reduced data requirements

The EZ FAFSA shall permit an applicant to submit for financial assistance purposes, only the data elements required to make a determination of whether the applicant meets the requirements under section 479(c). (iii)

State data

The Secretary shall include on the EZ FAFSA such data items as may be necessary to award State financial assistance, as provided under paragraph (6), except that the Secretary shall not include a State’s data if that State does not permit its applicants for State assistance to use the EZ FAFSA. (iv)

Free availability and processing

The provisions of paragraph (7) shall apply to the EZ FAFSA, and the data collected by means of the EZ FAFSA shall be available to institutions of higher education, guaranty agencies, and States in accordance with paragraph (9). (v)

Testing

The Secretary shall conduct appropriate field testing on the EZ FAFSA. (C)

Promoting the use of electronic fafsa

(i)

In general

The Secretary shall make all efforts to encourage all applicants to utilize the electronic forms described in paragraph (4). (ii)

Maintenance of the fafsa in a printable electronic file

The Secretary shall maintain a version of the paper forms described in subparagraphs (A) and (B) in a printable electronic file that is easily portable. The printable electronic file will be made easily accessible and downloadable to students on the same website used to provide students with the electronic application forms described in paragraph (4) of this subsection. The Secretary shall enable students to submit a form created under this subparagraph that is downloaded and printed from an electronic file format in order to meet the filing requirements of this section and in order to receive aid from programs under this title. (iii)

Reporting requirement

The Secretary shall report annually to Congress on the impact of the digital divide on students completing applications for title IV aid described under this paragraph and paragraph (4). The Secretary will also report on the steps taken to eliminate the digital divide and phase out the paper form described in subparagraph (A) of this paragraph. The Secretary’s report will specifically address the impact of the digital divide on the following student populations: independent students, adults, and dependent students. (4)

Electronic format

(A)

In general

The Secretary shall produce, distribute, and process common forms in electronic format to meet the requirements of paragraph (1). The Secretary shall develop common electronic forms for applicants who do not meet the requirements of subparagraph (C) of this paragraph. (B)

State data

The Secretary shall include on the common electronic forms space for information that needs to be submitted from the applicant to be eligible for State financial assistance, as provided under paragraph (6), except the Secretary shall not require applicants to complete data required by any State other than the applicant’s State of residence. (C)

Simplified Applications: fafsa on the web

(i)

In general

The Secretary shall develop and use a simplified electronic application form to be used by applicants meeting the requirements under subsection (c) of section 479 and an additional, separate simplified electronic application form to be used by applicants meeting the requirements under subsection (b) of section 479. (ii)

Reduced data requirements

The simplified electronic application forms shall permit an applicant to submit for financial assistance purposes, only the data elements required to make a determination of whether the applicant meets the requirements under subsection (b) or (c) of section 479. (iii)

State data

The Secretary shall include on the simplified electronic application forms such data items as may be necessary to award state financial assistance, as provided under paragraph (6), except that the Secretary shall not require applicants to complete data required by any State other than the applicant’s state of residence. (iv)

Availability and processing

The data collected by means of the simplified electronic application forms shall be available to institutions of higher education, guaranty agencies, and States in accordance with paragraph (9). (v)

Testing

The Secretary shall conduct appropriate field testing on the forms developed under this subparagraph. (D)

Use of forms

Nothing in this subsection shall be construed to prohibit the use of the forms developed by the Secretary pursuant to this paragraph by an eligible institution, eligible lender, guaranty agency, State grant agency, private computer software provider, a consortium thereof, or such other entities as the Secretary may designate. (E)

Privacy

The Secretary shall ensure that data collection under this paragraph complies with section 552a of title 5, United States Code, and that any entity using the electronic version of the forms developed by the Secretary pursuant to this paragraph shall maintain reasonable and appropriate administrative, technical, and physical safeguards to ensure the integrity and confidentiality of the information, and to protect against security threats, or unauthorized uses or disclosures of the information provided on the electronic version of the forms. Data collected by such electronic version of the forms shall be used only for the application, award, and administration of aid awarded under this title, State aid awarded under section 415C, or aid awarded by eligible institutions or such entities as the Secretary may designate. No data collected by such electronic version of the forms shall be used for making final aid awards under this title until such data have been processed by the Secretary or a contractor or designee of the Secretary, except as may be permitted under this title. (F)

Signature

Notwithstanding any other provision of this Act, the Secretary may permit an electronic form under this paragraph to be submitted without a signature, if a signature is subsequently submitted by the applicant or if the applicant uses a personal identification number provided by the Secretary under subparagraph (G) of this paragraph. (G)

Personal identification numbers authorized

The Secretary may assign to applicants personal identification numbers— (i)to enable the applicants to use such numbers in lieu of a signature for purposes of completing a form under this paragraph; (ii)to enable the applicants to use such numbers in lieu of a signature for purposes of completing forms required by States under section 415C; and (iii)for any purpose determined by the Secretary to enable the Secretary to carry out this title. (5)

Streamlining

(A)

Streamlined reapplication process

(i)

In general

The Secretary shall develop streamlined reapplication forms and processes, including both paper and electronic reapplication processes, consistent with the requirements of this subsection, for an applicant who applies for financial assistance under this title in the next succeeding academic year subsequent to the year in which such applicant first applied for financial assistance under this title. (ii)

Mechanisms for reapplication

The Secretary shall develop appropriate mechanisms to support reapplication. (iii)

Identification of updated data

The Secretary shall determine, in cooperation with States, institutions of higher education, agencies, and organizations involved in student financial assistance, the data elements that can be updated from the previous academic year’s application. (iv)

Reduced data authorized

Nothing in this title shall be construed as limiting the authority of the Secretary to reduce the number of data elements required of reapplicants. (v)

Zero family contribution

Applicants determined to have a zero family contribution pursuant to section 479(c) shall not be required to provide any financial data in a reapplication form, except that which is necessary to determine eligibility under such section. (B)

Reduction of data elements

(i)

Reduction required

Of the number of data elements on the FAFSA on the date of enactment of the College Aid Made EZ Act (including questions on the FAFSA for the purposes described in paragraph (6)), the Secretary, in cooperation with representatives of agencies and organizations involved in student financial assistance, shall reduce the number of such data elements by 50 percent within 5 years after such date of enactment. Reductions of data elements under paragraph (3)(B), (4)(C), or (5)(A)(iv) shall not be counted towards such 50 percent reduction unless those data elements are reduced for all applicants. (ii)

Report

The Secretary shall submit a report on the process of this reduction to each House of Congress within 2 years after such date of enactment. (6)

State requirements

(A)

In general

The Secretary shall include on the forms developed under this subsection, such State-specific nonfinancial data items as the Secretary determines are necessary to meet State requirements for need-based State aid under section 415C, except as provided in paragraphs (3)(B)(iii) and (4)(C)(iii) of this subsection. Such items shall be selected in consultation with State agencies that submit applications under section 415C in order to assist in the awarding of State financial assistance in accordance with the terms of this subsection, except as provided in paragraphs (3)(B)(iii) and (4)(C)(iii) of this subsection. The number of such data items shall not be less than the number included on the form on October 7, 1998, unless a State notifies the Secretary that the State no longer requires those data items for the distribution of State need-based aid. (B)

Annual review

The Secretary shall conduct an annual review process to determine which forms and nonfinancial data items the States require to award need-based State aid and other application requirements that the States may impose. (C)

State use of simplified forms

The Secretary shall encourage states to take such steps as necessary to encourage the use of simplified application forms, including those described in paragraphs (3)(B) and (4)(C), to meet the requirements under subsection (b) or (c) of section 479. (D)

Federal register notice

The Secretary shall publish on an annual basis a notice in the Federal Register requiring State agencies to inform the Secretary— (i)if the State agency is unable to permit applicants to utilize the simplified application forms described in paragraphs (3)(B) and (4)(C); and (ii)of the State-specific nonfinancial data that the State agency requires for delivery of State need-based financial aid. (E)

State notification to the secretary

(i)

In general

Each State agency that submits an application under section 415C shall notify the Secretary— (I)whether the State permits an applicant to file a form described in paragraph (3)(B) or (4)(A) of this subsection for purposes of determining eligibility for State need-based grant aid; and (II)the State-specific nonfinancial data that the State agency requires for delivery of State need-based financial aid. (ii)

Acceptance of forms

In the event that a State does not permit an applicant to file a form described in paragraph (3)(B) or (4)(A) of this subsection for purposes of determining eligibility for State need-based grant aid— (I)the State shall notify the Secretary if the State is not permitted to do so because of either State law or because of agency policy; and (II)the notification under subclause (I) shall include an estimate of the program cost to permit applicants to complete simplified application forms under paragraphs (3)(B) and (4)(A) of this subsection. (iii)

Lack of notification by the state

If a State does not notify the Secretary pursuant to clause (i), the Secretary shall— (I)permit residents of that State to complete simplified application forms under paragraphs (3)(B) and (4)(A) of this subsection; and (II)not require any resident of that State to complete any nonfinancial data previously required by that State under this section. (7)

Charges to students and parents for use of forms prohibited

(A)

Fees prohibited

The FAFSA, in whatever form (including the EZ–FAFSA, paper, electronic, simplified, or reapplication), shall be produced, distributed, and processed by the Secretary and no parent or student shall be charged a fee for the collection, processing, or delivery of financial aid through the use of the FAFSA. The need and eligibility of a student for financial assistance under parts A through E of this title (other than under subpart 4 of part A) may only be determined by using the FAFSA developed by the Secretary pursuant to this subsection. No student may receive assistance under parts A through E of this title (other than under subpart 4 of part A), except by use of the FAFSA developed by the Secretary pursuant to this subsection. No data collected on a form for which a fee is charged shall be used to complete the FAFSA. (B)

Notice

Any entity that provides to students and parents, or charges students or parents for, any value-added services with respect to or in connection with the FAFSA, such as completion of the FAFSA, submission of the FAFSA, or tracking of the FAFSA for a student, shall provide to students and parents clear and conspicuous notice that— (i) the FAFSA is a free Federal student aid application; (ii)the FAFSA can be completed without professional assistance; and (iii)includes the current Internet address for the FAFSA on the Department’s web site. (8)

Application processing cycle

The Secretary shall enable students to submit a form created under this subsection in order to meet the filing requirements of this section and in order to receive aid from programs under this title and shall initiate the processing of applications under this subsection as early as practicable prior to January 1 of the student’s planned year of enrollment.

;

(2)by adding at the end of subsection (a) the following paragraph:

(13)

Early application and award demonstration program

(A)

Program required

The Secretary shall, no later than two years after the date of enactment of the College Aid Made EZ Act, implement an early application demonstration program enabling dependent students to complete applications under this subsection in their junior year of high school, or in the academic year that is two years prior to their intended year of enrollment, and to be eligible to receive aid under this title and such aid as may be available from participants, including State financial assistance as provided under section 415C and other aid provided by participating institutions. (B)

Purpose and objectives

The purpose of the demonstration program under this paragraph shall be to measure the benefits, in terms of student aspirations and plans to attend college, and the adverse effects, in terms of program costs, integrity, distribution, and delivery of aid under this title, of implementing an early application system for all dependent students that allows dependent students to apply for financial aid using information from the year prior to the year prior to enrollment. Additional objectives associated with implementation of the demonstration program are the following: (i)Measure the feasibility of enabling dependent students to apply for Federal, State, and institutional financial aid in their junior year of high school, using information from the year prior to the year prior to enrollment, by completing any of the application forms under this subsection. (ii)Determine the feasibility, benefits, and adverse effects of implementing a data match with the Internal Revenue Service (IRS). (iii)Identify whether receiving final financial aid awards no later than the fall of the senior year provides students with additional time to compete for the limited resources available for State and institutional financial aid and positively impacts the college aspirations and plans of these students. (iv)Measure the impact of using income information from the year prior to the year prior to enrollment on— (I)eligibility for financial aid under this title and for other institutional aid; and (II)the cost of financial aid programs under this title. (iv)Effectively evaluate the benefits and adverse effects of the demonstration program on program costs, integrity, distribution, and delivery of aid. (C)

Participants

The Secretary shall select States and institutions within those States to participate in the demonstration program under this paragraph that are participating in the programs under this title and that are willing to make final financial aid awards to students based on their application information from the year prior to the year prior to enrollment. The Secretary shall also select as participants in the demonstration program secondary schools and dependent students that are located in the participating States. (D)

Application process

The Secretary shall insure that the following provisions are included in the demonstration program: (i)Participating States and institutions shall allow participating students to apply for financial aid during their junior year of high school using information from the year prior to the year prior to enrollment and all provisions available under this title and shall award final financial aid awards to participating students based on the applications provided under this demonstration program. (ii)Participating States and institutions shall not require students participating in this demonstration program to complete an additional application in the year prior to enrollment in order to receive State aid under section 415C and any other institutional aid. (iii)Financial aid administrators at participating institutions shall be allowed to use their discretion in awarding financial aid to participating students, as outlined under section 479A and section 480(d)(7). (E)

Data match with the Internal Revenue Service

The Secretary shall include in this demonstration project a data match with the Internal Revenue Service in order to verify data provided by participating students and gauge the feasibility of implementing such a data match for all students applying for aid under this title. (F)

Evaluation

The Secretary shall conduct a rigorous evaluation of this demonstration program in order to measure its benefits and adverse effects as indicated under subparagraph (A). (G)

Outreach

The Secretary shall make appropriate efforts in order to notify States of the demonstration program under this paragraph. Upon determination of participating States, the Secretary shall continue to make efforts to notify institutions and dependent students within participating States of the opportunity to participate in the demonstration program and of the participation requirements.

(3)by striking subsection (b); (4)by redesignating subsections (c), (d), and (e) as subsections (b), (c), and (d), respectively. (b)

Master calendar

Section 482(a)(1)(B) (20 U.S.C. 1089) is amended to read as follows:

(B)by March 1: proposed modifications, updates, and notices pursuant to sections 479(c)(2)(C), 478, and 483(a)(6) published in the Federal Register;

Increasing access to technology

Section 483 (20 U.S.C. 1087ss) is further amended by adding at the end the following:

(e)

Addressing the digital divide

The Secretary shall utilize savings accrued by moving more applicants to the electronic forms described in subsection (a)(4) to improve access to the electronic forms described in subsection (a)(4) for applicants meeting the requirements of section 479(c).

Simplify the treatment of income: reducing untaxed income and benefits

Subsection (b) of section 480 (20 U.S.C. 1087vv(b)) is amended to read as follows:

(b)

Untaxed income and benefits

(1)The term untaxed income and benefits means— (A)child support received; (B)workman's compensation; (C)veteran's benefits such as death pension, dependency, and indemnity compensation, but excluding veterans’ education benefits as defined in subsection (c); (D)interest on tax-free bonds; (E)housing, food, and other allowances (excluding rent subsidies for low-income housing) for military, clergy, and others (including cash payments and cash value of benefits); (F)cash support or any money paid on the students behalf, except, for dependent students, funds provided by the students parents; (G)untaxed portion of pensions; (H)payments to individual retirement accounts and Keogh accounts excluded from income for Federal income tax purposes; and (I)any other untaxed income and benefits, such as Black Lung Benefits, Refugee Assistance, railroad retirement benefits, or Job Training Partnership Act noneducational benefits or benefits received through participation in employment and training activities under title I of the Workforce Investment Act of 1998. (2)The term untaxed income and benefits shall not include the amount of additional child tax credit claimed for Federal income tax purposes.

Reducing the number of questions

Section 484 (20 U.S.C. 1091) is amended by striking subsection (r).

Allowance for state and other taxes

(a)

Allowance for state and local taxes

Section 478 (20 U.S.C. 1087rr) is amended— (1)by striking subsection (g); (2)by redesignating subsection (h) as subsection (g). (b)

Holding students harmless

Section 475(c) (20 U.S.C. 1087oo(c)) is amended— (1)in paragraph (1): (A)by striking subparagraph (B); (B)by redesignating subparagraphs (C), (D), (E), and (F) as subparagraphs (B), (C), (D), and (E), respectively; (2)by striking paragraph (2); (3)by striking paragraph (4) and inserting the following:

(4)

Income protection allowance

The income protection allowance is determined by the following table (or a successor table prescribed by the Secretary under section 478): Income Protection AllowanceFamily SizeNumberin College(including student)12345For each additional subtract:2$15,207$12,599$3,641318,93716,350$13,742423,38820,77918,193$15,596527,59524,98622,40019,802$17,216632,26829,67027,08424,48721,900For each additional add:2,5862,5862,5862,5862,586

(4)by redesignating paragraphs (3), (4) and (5) as paragraphs (2), (3) and (4), respectively. (c)

Dependent student increase in income protection allowance

Section 475(g) (20 U.S.C. 1087oo(g)) is amended— (1)in paragraph (2)— (A)by striking subparagraph (B); (B)by striking subparagraph (D) and inserting the following:

(D)an income protection allowance of $2,589 (or a successor amount prescribed by the Secretary under section 478);

(C)by redesignating subparagraphs (C), (D), (E), and (F) as subparagraphs (B), (C), (D), and (E), respectively; (2)by striking paragraph (3); and (3)by redesignating paragraphs (4), (5), and (6) as paragraphs (3), (4), and (5), respectively. (d)

Independent student (without dependents) increase in income protection allowance

Section 476(b) (20 U.S.C. 1087pp(b)) is amended— (1)in subparagraph (A) of paragraph (1)— (A)by striking clause (ii); (B)by striking subclauses (I), (II) and (III) of clause (iv) and inserting the following:

(I)$5,874 for single students; (II)$5,874 for married students who are both enrolled pursuant to subsection (a)(2); and (III)$9,395 for married students where one is enrolled pursuant to subsection (a)(2);

;

(C)by redesignating clauses (iii), (iv), (v), (vi), as clauses (ii), (iii), (iv), and (v), respectively; (2)by striking paragraph (2); (3)by redesignating paragraphs (3), (4), and (5) as paragraphs (2), (3), and (4), respectively. (e)

Independent student (with dependents) increase in income protection allowance

Section 477(b) (20 U.S.C. 1087qq(b)) is amended— (1)in paragraph (1)— (A)by striking subparagraph (B); (B)by redesignating (C), (D), (E), and (F) as subparagraphs (B), (C), (D), and (E), respectively; (2)by striking paragraph (2); (3)by striking paragraph (4) and inserting the following:

(4)

Income protection allowance

The income protection allowance is determined by the following table (or a successor table prescribed by the Secretary under section 478): Income Protection AllowanceFamily SizeNumberin College(including student)12345For each additional subtract:2$16,935$12,599$3,641318,93716,350$13,742423,38420,77918,193$15,596527,59624,98622,40019,802$17,216632,26829,67027,08424,48721,900For each additional add:2,5862,5862,5862,5862,586

(4)by redesignating paragraphs (3), (4), and (5) as paragraphs (2), (3), and (4), respectively. (f)

Conforming amendment: updates

Section 478(b) (20 U.S.C. 1087rr(b)) is amended— (1)in paragraph (1)— (A)by striking 1993–1994 and inserting 2005–2006; (B)by striking 475(c)(4) and 477(b)(4) and inserting 475(c)(3) and 477(b)(3); and (C)by striking December 1992 and inserting December 2004; and (2)in paragraph (2)— (A)by striking 2000–2001 and inserting 2005–2006; (B)by striking 475(g)(2)(D) and 476(b)(1)(A)(iv) and inserting 475(g)(2)(C) and 476(b)(1)(A)(iii); and (C)by striking December 1999 and inserting December 2004.

Relief for working students

(a)

Dependent students

Paragraph (4) of section 475(g) (20 U.S.C. 1087oo(g)(4)), as redesignated by section 7(c)(3) of this Act, is amended to read as follows:

(4)the student’s available income (determined in accordance with paragraph (1) of this subsection) is assessed at 40 percent.

(b)

Independent students without dependents other than a spouse

Paragraph (4) of section 476(b) (20 U.S.C. 1087pp(b)), as redesignated by section 7(d)(3) of this Act, is amended to read as follows:

(4)

Assessment of available income

The family’s available income (determined in accordance with paragraph (1)(A) of this subsection) is assessed at 40 percent.