Hey guys, I'm about to fill out my FAFSA for college, but I'm a bit confused about income. What counts as income when filling out the FAFSA, and are there any income qualifications I should be aware of? Thanks for the help!
Hey there! When filling out the FAFSA, there are several types of income that will need to be reported. I'll break it down for you:
1. Adjusted Gross Income (AGI): This includes your (and your parents', if you're a dependent) income from salaries, wages, tips, and other sources, minus specific deductions. It's important to use the AGI from the required tax year, which can be found on the federal income tax return.
2. Taxable income: This includes any income that was taxed in the reported tax year, such as interests, dividends, rental income, and capital gains. Be sure to include your parents' taxable income if you're a dependent student.
3. Untaxed income: This includes any income that was not taxed, like child support received, tax-deferred pension contributions, untaxed portions of IRA distributions, and other untaxed sources. This information might be found on your parents' W-2 forms or other tax documents.
4. Exclusions: Some types of income, like Social Security benefits, Supplemental Security Income, welfare benefits, and Veterans Affairs benefits, are typically not included in FAFSA calculations.
There aren't any specific income qualifications you need to be aware of when filling out the FAFSA. However, it's important to know that eligibility for federal student aid is determined based on the financial need of the student and their family. Your Expected Family Contribution (EFC) will be calculated using the financial information you provide, and this will be used by schools to determine your financial aid package.
One more thing to keep in mind: starting with the 2023-2024 school year, the FAFSA replaced the term "Expected Family Contribution (EFC)" with "Student Aid Index (SAI)." The new SAI can range as low as -$1,500, which allows for more accurate representation of a family's financial need.
Best of luck with your FAFSA, and I hope you receive a great financial aid package!
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