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WestrnMom
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Posted: Mon Jan 1st, 2007 05:32 pm |
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Will they accept 2005 financial data between now and April if you don't have 2006 figured out? What exactly goes to the schools from FAFSA? Do they see your ECA? What about the actual numbers? Must you request it be sent to all your child's schools, or can they get it directly?
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jocelynDAD
Member
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Posted: Mon Jan 1st, 2007 06:29 pm |
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FAFSA is based on the iincome for the previous year, so for 2007 graduates, you must supply your income for the year 2006.
In many cases, the school will want to see the child's and the parent(s) income tax forms that were filed for the year 2006.
If you have extraordinary circumstances and are delaying the April 15th submittal, the school will want to see as much current information with backup data.
You can estimate the FAFSA, but must update it with the final information sent to the IRS.
There really is no alternative to disclosing fully if you are interested in any loans, grants and in some cases Merit aid from a college. 
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CarolynLawrence
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Posted: Mon Jan 1st, 2007 06:49 pm |
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JD is correct. The FAFSA is based on 2006 income. If you won't be filing your tax return until March or April, you shouldn't wait to complete the FAFSA, however. Instead, calculate your adjusted gross income (AGI) and taxes paid using the instructions for IRS Form 1040 (you can get this information from http://www.irs.gov/formspubs/index.html) After you file your official tax form, you may need to make corrections to the FAFSA, and some, but not all, colleges may ask for a copy of the tax return.
About three weeks after you file the FAFSA, you'll get a Student Report (SAR) that shows your EFC. The colleges will receive the SAR information through the Institutional Student Information Record, although sometimes they may ask for a copy of the SAR from you as well. They'll use the SAR/ISIR EFC to determine your award. If there are any special circumstances that do not show in FAFSA, you should contact the school and ask if they want to know those circumstances now or after the award is made (some schools make all awards before considering appeals).
I have a list of financial aid resources on my blog: http://collegehunt.blogspot.com/2006/11/financial-aid-basics.html I particularly recommend the free video, Start Here, Go Fursther With Federal Student Aid -- it's a good overview of what happens with your FAFSA, and filing it, but the other resources I listed there are also very helpful as well.
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Thumper
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Posted: Mon Jan 1st, 2007 09:55 pm |
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| If your child is going to be a college freshman this coming fall...please...get your taxes done as soon as possible after February 1. By law, you should have all of your information by Jan. 31. This is not the year to delay doing your taxes until April 15. Yes, you can complete both the FAFSA and Profile using estimates, and you can later amend them (the FAFSA can be amended online, the Profile must be done by hand and mailed to the colleges). Some schools will give your child an estimated finaid award using the estimated information. Some schools will not. In all cases, your kid's financial aid award will NOT be finalized until the FAFSA and in necessary, the Profile, are updated to reflect what is on your 2006 federal tax return. And...if you wait too long, there are some schools that will simply run out of institutional money. This is not the year to wait...plan to get this done ASAP. The good news is that for finaid renewals, the deadlines are later in the calendar year.
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CarolynLawrence
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Posted: Mon Jan 1st, 2007 10:11 pm |
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Excellent advice Thumper. In fact, I'm naming you  for the day for a great post.
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DesperateDad
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Posted: Mon Jan 1st, 2007 10:42 pm |
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I concur with the spirit of Thumper's post, but one small nit: not "all" info is available by Jan 31; Form 1065 (partnerships) can be provided to partners as late as it's filing due date, generally, April 15.
As others have noted, do NOT miss the college finaid deadline, even if one has to submit estimates and amend later.
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WestrnMom
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Posted: Mon Jan 1st, 2007 10:53 pm |
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Paperwork may be required by law to arrive no later than January 31st but last year one form was a month late. I don't know why you can't use 2005 returns if your income is similar. It's not a question of procrastinating so much as the fact that it's not always easy to get one's returns done quickly.
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Thumper
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Posted: Mon Jan 1st, 2007 11:24 pm |
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| You CAN use 2005 information and complete your FAFSA using the "will file" status (meaning you will be filing your 2006 taxes but have not yet done so). However, be aware that your kid's finaid award will not be finalized until the 2006 information is provided to the school. Finaid for the 2006-07 school years is based on your income from 2006, not 2005 (even if the amounts are identical), and most schools want verification via those completed tax returns of the amounts for that 2006 income. BTW...last year (when dd was a high school senior) we did complete the FAFSA using estimates by today (no kidding). She received estimated finaid awards from her schools in early February. We amended the FAFSA (and Profile by hand) in early Feb. The schools sent finalized finaid awards in March...and one school (the one that did not use the Profile) reduced her finaid award by $3000. Even though we used good estimates and actually made our incomes more than the estimates, the actual numbers were different. So...just be aware that your estimated finaid awards and final finaid awards "can" change.
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binx
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Posted: Tue Jan 2nd, 2007 02:38 am |
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I don't know how it works, but.... My H's company does our taxes (and will for the next 7 years!) and they don't get done until June or July - or later. They do the German taxes first, then file for a zillion US extensions. The FAFSA is a nightmare, but we send in our best guess, with lots and lots of creative writing and explanation. The FAFSA is a straight formula, which is a joke in our situation. It always shows that we can afford big bucks (due to expenses paid by the company but counted as income.) We have to hope that schools read the explanations when they make their decisions. The first year or so, we did file the amended form late in the year, but it was never acknowledged, and didn't change anything. That was the year we had two in college, and S1 did qualify for significant aid. S2's scholarships are merit based, so we have to fill out the FAFSA, but it doesn't really affect anything. I don't know what will happen with D.
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WestrnMom
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Posted: Tue Jan 2nd, 2007 02:52 pm |
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Thumper, is merit aid based on FAFSA information? I thought that was independent of need-based.
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CarolynLawrence
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Posted: Tue Jan 2nd, 2007 04:11 pm |
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WesrnMom,
The need to file a FAFSA in order to be considered for merit money (as opposed to need-based financial aid) varies from school to school.
Some schools have merit awards set aside that have a need-based component to them. They will therefore ask all students who want to be considered for merit money to file a FAFSA. But, obviously if your EFC is very high (i.e., close to the cost of attendance), your chances of getting one of these merit awards with a need-component are going to be slim in any case.
At most schools that offer merit money, it is based entirely on "merit" (which can have many components) and there is no requirement to file the FAFSA to be considered for a merit award. My daughter, for instance, received merit from both Beloit and Goucher and we never filed a FAFSA.
However, it is always a good idea to double check with each school on the list about whether they require a FAFSA to be considered for merit. Most wont, but a few will.
Carolyn
Last edited on Tue Jan 2nd, 2007 04:12 pm by CarolynLawrence
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WestrnMom
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Posted: Tue Jan 2nd, 2007 05:51 pm |
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Carolyn, thank you. A few schools S looked at required the Profile for all merit aid, but I don't see as much mention of the FAFSA as needed for merit. We would definitely send the FAFSA to any school that needs it sent, but I saw on an explanation form that you can only send copies to 4 schools, so I want to be sure before making the decision as to where to send it especially since not all his decisions are in yet.
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Thumper
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Posted: Tue Jan 2nd, 2007 10:01 pm |
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| Westrnmom...you will need to check with the schools...but my experience is that any school that requires the Profile for merit aid will also require the FAFSA. Remember, that the Profile deals with the institutional methodology (monies awarded by the schools primarily) and the FAFSA deals with federal methodology (monies awarded by the government primarily). The FAFSA is used by all colleges (so far as I know) to compute need based aid. The Profile is required by some to supplement the info provided by the FAFSA. Some schools DO require that the FAFSA and, if they require it, the Profile to be submitted even for merit aid consideration. E.g. DS's university required both the FAFSA and the Profile for consideration of ALL financial aid (except some very exclusive scholarships that had a completely different application). The only way to know what a college requires is to check and read carefully THAT college's finaid info. And regarding 2005 vs 2006 income...again I say...the colleges will not finalize your student's financial aid award until they receive firm verification of the income from 2006. My guess is that in Binx's case where the company does the filing, that there was sufficient documentation and explanation for not being able to provide the tax info in the college's timely fashion. However, I would venture to guess that this is not the norm. It is an extenuating circumstance. These deadlines are not a surprise and they do not fluctuate from year to year very much. It's just this ONE year that requires early preparation. By all means...submit your FAFSA and Profile info using estimates. That is the thing to do. BUT also try your very best to get your 2006 taxes done as soon as possible. Otherwise you "could" be jeopardizing the finaid award your child might receive.
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CarolynLawrence
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Posted: Tue Jan 2nd, 2007 11:47 pm |
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| Geez, could they make this a little trickier? It seems so obvious - NOT!
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Thumper
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Posted: Wed Jan 3rd, 2007 01:22 am |
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| Truthfully, I think the finaid application process is VERY complicated. I also think someone could make a FORTUNE by merging the FAFSA with Turbo tax.
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WestrnMom
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Posted: Wed Jan 3rd, 2007 02:42 am |
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Financial aid is complicated. Some of the applications (like the Cal States-especially if you take summer school) are complicated--although you only have to fill it out once and it can be used for all schools.
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HImom
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Posted: Wed Jan 3rd, 2007 05:30 am |
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I agree that FAid apps are complicated. Some schools have separate apps that have to be completed for Merit or FAid. It really does get somewhat complicated, but it's crucial for deadlines to be met.
I called each U our S was seriously considering last year & confirmed whether or not they required ANY forms completed by us to have S considered for merit aid. Fortunately, NONE of the schools he was applying to required any FAid forms, so he was able to just submit his U app by the merit aid deadlines to be considered. Some schools did have additional merit aid apps, but he didn't apply for those & the school he chose didn't require additional merit aid apps.
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NJres
Member
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Posted: Sat Jan 6th, 2007 06:29 pm |
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I filled out FAFSA the other night. Actually, it is my son's FAFSA, but I filled it out anyway. Pretty sure I made a mistake. My healthcare deductions are made pretax. so in addition to 401k contributions, my reported wages are reduced by other pretax deductions. I think FAFSA only lets you take out the 401k contributions, but then you have to add them back in later. So I held out all my pretax deductions but only added back in the 401k contributions. Oh well, I will make changes in a couple of weeks when I get my W-2s and other tax forms.
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entomom
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Posted: Sat Jan 6th, 2007 11:12 pm |
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NJres,
Now that you mention it, I think I did the same thing. I'm looking at Worksheet B right now and realize that I should have added it as "Other untaxed income..." I think what I did was look at their examples and since I don't have anything like them, I put zero. We'll since it's just an estimate and since my SAR came back high (as expected), it won't make much difference in our situation.
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entomom
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Posted: Mon Feb 5th, 2007 08:49 pm |
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Hi all, bringing this up again because I was going to do a final FAFSA last night since I just filed my taxes. However in reading the instructions for Worksheet B, where you add back in all of your untaxed income, I had second thoughts as to whether or not I should include my Flexible Spending Account for uncovered health expenses and my Health Insurance Premiums. So I called the FAFSA hotline this morning and the answer was NO to both.
I admit that it doesn't make sense to me, I do have to declare the money put into a 401 plan even though it isn't "available" to fund college. But that what I was told, and there is some reference to not including "flexible spending arrangements" in the Worksheet B instructions. Anyway, just thought this might be of interest to other first time FAFSA parents.
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