Students incarcerated in federal and state penal institutions aren’t eligible for Pell Grants, but those incarcerated in local and county penal institutions are potentially eligible for Pell.
A student confined or incarcerated in a juvenile justice facility is potentially eligible for Pell. Students incarcerated by jurisdictions defined as a state in the law, such as the District of Columbia, are considered to be in a state penal institution and aren’t eligible for Pell Grants.
A student isn’t considered incarcerated (and thus barred from potential Pell eligibility) if he or she is in a halfway house or home detention or is sentenced to serve only on weekends, or if he/she is confined in any sort of facility prior to the imposition of any criminal sentence or juvenile disposition while awaiting trial. (Federal Student Aid Handbook pg. 1-76)
As per the Federal Student Aid Handbook (pg.1-17), the definition for Incarcerated students is as follows:
A student is considered to be incarcerated if she is serving a criminal sentence in a federal or state penitentiary, prison, jail, reformatory, work farm, or similar correctional institution (whether it is operated by the government or a contractor).
A student is not considered to be incarcerated, and is still potentially eligible for Pell, FSEOGs and FWS, but not Direct Loans, if he or she is in a halfway house, juvenile justice facility, a local or county jail, a local or county penitentiary or correctional facility, or is subject to home detention or is sentenced to serve only weekends.
A parent is not eligible for a PLUS loan if the federal government holds a judgment lien on her property or if she is incarcerated.