Family Farm and Small Business Exemption Act

Family Farm and Small Business Exemption Act

This bill restores an exemption for certain family farms and small businesses on the Free Application for Federal Student Aid (FAFSA) form. The bill applies to the net worth of (1) a family farm on which the family resides, or (2) a small business with not more than 100 full-time or full-time equivalent employees that is owned and controlled by the family.

Prior to recent changes made to the FAFSA, the net worth of these family farms and small businesses were excluded as assets when calculating a student's financial need to determine federal student aid eligibility. Beginning with the 2024-2025 academic year, the net worth of these farms and businesses are treated as an asset and therefore included in the calculation. This bill restores the exemption to exclude such net worth from the calculation.

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 469 Introduced in Senate (IS)]

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119th CONGRESS
  1st Session
                                 S. 469

To restore the exemption of family farms and small businesses from the 
  definition of assets under title IV of the Higher Education Act of 
                                 1965.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

             February 6 (legislative day, February 5), 2025

  Ms. Ernst (for herself, Mr. Bennet, Mr. Grassley, Mr. Marshall, Mr. 
   Justice, Mr. Moran, Mr. Hoeven, Mr. Rounds, Mr. Boozman, and Mr. 
    Tillis) introduced the following bill; which was read twice and 
  referred to the Committee on Health, Education, Labor, and Pensions

_______________________________________________________________________

                                 A BILL


 
To restore the exemption of family farms and small businesses from the 
  definition of assets under title IV of the Higher Education Act of 
                                 1965.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Family Farm and Small Business 
Exemption Act''.

SEC. 2. EXEMPTING FAMILY FARMS AND SMALL BUSINESSES FROM ASSETS UNDER 
              THE HIGHER EDUCATION ACT OF 1965.

    (a) In General.--Section 480(f)(2) of the Higher Education Act of 
1965 (20 U.S.C. 1087vv(f)(2)) is amended--
            (1) by striking ``net value of the'' and inserting the 
        following: ``net value of--
                    ``(A) the'';
            (2) by striking the period at the end and inserting a 
        semicolon; and
            (3) by adding at the end the following:
                    ``(B) a family farm on which the family resides; or
                    ``(C) a small business with not more than 100 full-
                time or full-time equivalent employees (or any part of 
                such a small business) that is owned and controlled by 
                the family.''.
    (b) Applicability.--The amendments made by subsection (a) shall 
apply to need analysis conducted under part F of title IV of the Higher 
Education Act of 1965 (20 U.S.C. 1087kk et seq.) for award years 
beginning on or after the date of the enactment of this Act.
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