For the 22-23 school year, the ‘Free Application for Federal Student Aid’ (often known as FAFSA) will begin on October 1, 2021.
In a year marked by rapid change, ‘the FAFSA application’ has experienced a few changes as well.
Select talked with Kalman Chany, the president and CEO of Campus Consultants, a company that helps families through the financial aid process.
to get a summary of why this year’s application is so important.
What makes this year’s FAFSA application unique?
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While the questions on the application will remain the same for the next school year. Chany adds that how the responses are understood will change.
A question regarding drug offenses and a question about enrolling with the Selective Service are two items on the application that has traditionally
been “disqualifiers” for financial assistance.
Students who were receiving financial help at the time of their drug conviction were already banned from getting future financial aid.
Male students over the age of 18 who claim on their FAFSA forms that they have not registered for the draughts have also been denied financial aid.
These two items will remain on the application, but students will no longer be able to receive federal financial assistance if they have a drug
conviction or have not registered for the draught.
There will be a few other minor changes, according to the ‘Federal Student Aid’ website,
including a visual website upgrade and the option for users to designate whether they are a student, parent, or preparer before starting the FAFSA
application.
What impact would unemployment benefits from Covid-19 have on students’ applications?
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According to Chany, some families that received Covid-19 unemployment compensation under the CARES Act may find it difficult to complete the
FAFSA application this year.
In 2020 and 2021, some families that got greater work benefits may have earned more money than in previous years. Furthermore, ‘March 11, 2021’
was the day on which they authorized unemployment compensation exclusion (UCE)
, gave unemployed individuals receiving unemployment benefits a’ tax break of’ ‘up to $10,200’.
Because ‘the tax filing season ‘ started in February 2021,
before the provision was enacted, individuals who filed their taxes earlier were unable to receive the tax break at the time. When it came to mailing
out refund checks, the IRS made a change for taxpayers.
However, this creates a dilemma for early filers who are currently completing ‘the FAFSA form’ for their students this year.
They have effectively exaggerated their income if they do not claim the UCE tax credit on their tax returns, which may reduce the amount of federal
student assistance those families can get.
“When some individuals submitted their tax returns in February or early March, the clause allowing for tax-free unemployment income up to $10,200
had not yet been passed,” Chany said.
“The IRS said that early filers would not need to alter their tax forms and that the tax credit would still be given to them.
The problem is that individuals who filed early and used ‘the IRS Data Retrieval Tool’ on the FAFSA form will have their income exaggerated since the
Data Retrieval Tool will retrieve the data before the IRS makes the UCE adjustments.’
Their adjusted gross income’ would have been lowered by the UCE tax break.”
Financial Aid Administrators are encouraged to engage with impacted families and use their professional judgment to properly modify the family’s
adjusted gross income on the application, according to guidance from the Office of Federal Student Aid.
What should be done by ‘families that have been affected?’
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If a family is concerned about how the lack of a UCE tax credit will affect their FAFSA application,
Chany suggests waiting for more information before filling out the form, as long as their student isn’t applying to or attending school in a state that
offers financial aid on a first-come, first-served basis.
Alaska, Illinois, Kentucky, Missouri, Nevada, North Carolina, North Dakota, Oklahoma, Oregon, South Carolina, Texas, Vermont, and Washington are
among the 13 states that do so.
“Filing early only helps if the school distributes money on a first-come, first-served basis,” he said.
“Otherwise, there is no benefit to filling out the FAFSA application as soon as it becomes available on October 1st. It’s best to wait and make sure you
get the necessary tax advice before filling out the form.”
What’s the most efficient method to complete the application?
Students and parents should go to fafsa.gov to register, log in, or print a paper copy of the application ‘to begin filling it out.
The student’s complete name, permanent mailing address, ‘birth date’, ‘social security number’,
driver’s license number, email address, citizenship, alien registration number (if applicable), and marital status you must enter all first.
Students must also state if they are enrolled in the Selective Service (if male) and whether they have ever been convicted of a narcotics offense (but
the answers to these questions will no longer impact your eligibility to receive financial aid).
Students will also provide information on their high school and the college degree they want to pursue.
they addressed The student’s tax filing status will be in the following part,
which will contain questions regarding the student’s and their spouse’s adjusted gross income, tax filing status, Schedule 1 filing, and adjusted gross
income for the year 2020. (if applicable).
You’ll also be asked about child support, education tax credits, any scholarships you’ve earned, and any other programs or government payments
you’ve received.
In able to qualify for federal assistance,
The third part contains questions to assess if the student’s parents must disclose their income and tax information. ‘On the FAFSA application ‘,
students ‘who are dependents’ must generally submit information about’ their parents’ income tax returns ‘.
Parents will provide their personal information and answer questions about their adjusted gross income, earnings, taxable income, and assets.
after it is decided whether their information is required.
The next part is intended for students who are not dependents and requests information about their homes. Students put in the names of the schools
they want to obtain financial assistance for in the last two areas.
Students should be aware of each institution’s federal school code,
which be located on the financial assistance portion of the college’s website. If they can’t locate it, they may just put each school’s name in.
The kids and parents must then sign and date the paperwork before submitting it.
you can obtain this information in an application draught on the Federal Student Aid website, or in Chany’s newest 2021 version of “Paying For
College 2022: Everything You Need to Maximize Financial Aid and Afford College,” which includes additional suggestions and advice.
Remember that you’ll have to reapply for financial assistance each year you’re in school.
The time it takes to get your financial aid award letter, which details how much money you’ll be receiving, varies per school.
Schools, on the other hand, usually send out award letters three months after receiving FAFSA information from the Department of Education.
The deadline to submit a FAFSA application for the school year 22-23 is June 30, 2023. Even if you’re still applying to schools and they do not accept,
you may still fill out and submit the form.
source /
What you need to know about changes to the ’22-’23 FAFSA application and how to fill out the form
