FAFSA Tips: Independent vs Dependent

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Occasionally, I get questions from parents and students regarding financial aid, especially when it comes to filing the Free Application for Federal Student Aid (FAFSA). Most are worried that they make too much money to qualify for any grants or scholarships, and want to know if they should even bother completing the form.

And, in case you’re wondering…yes, everyone, regardless of income, should complete the FAFSA. Others, however, seem to be a bit confused as to what income should even be included on the form. So, I thought it might be a good time to tackle a comment from one of our recent posts. Laura writes:

“When my son graduates, he will be 18 and we will no longer financially support him. What we would like to know is if he would qualify for a Pell Grant?”

Although Laura’s main concern is Pell Grant funding, she’s making an all too common mistake when it comes to federal financial aid. She believes that once her child has reached the age of 18, he is on his own. Although this may be true for many things, when it comes to filing the FAFSA it’s generally not the case.

Most students under the age 24 will still be required to include their parents’ income when completing the FAFSA because they are considered dependent students. There are, of course, certain circumstances where students who are younger than 24 could be considered independent students.

To find out if your son or daughter is considered independent or dependent for FAFSA purposes, have him or her take this short quiz.

Is your Child a Dependent?

1. Were you born before January 1, 1991? If yes, you are independent. No? Move to the next question.

2. Are you currently married or separated? If yes, you are independent. No? Move to the next question.

3. Will you be working on a master’s degree when you enter college this school year? If yes, you are independent. No? Move to the next question.

4. Are you a veteran of the U.S. armed forces? If yes, you are independent. No? Move to the next question.

5. Do you have children (or will have a child during the current school year) who receive more than half their support from you? If yes, you are independent. No? Move to the next question.

6. Do you have dependents (other than a child or spouse) who live with you and receive more than half their support from you? If yes, you are independent. No? Move to the next question.

7. Since the age of 13, have both your parents died, were you placed in foster care, or were you a ward of the court? If yes, you are independent. No? Move to the next question.

8. Has your state court (legal residence) determined you are an emancipated minor or placed you in a legal guardianship? If yes, you are independent. No? Move to the next question.

9. Has it been determined that you are a homeless, unaccompanied youth, or that you are self-supporting and at risk of being homeless? If yes, you are independent.

If your child answered ‘no’ to all these questions, he or she is considered a dependent student when it comes to completing the FAFSA. That means you’ll not only need to include his or her income on the FAFSA form, but also your income (and your spouse’s), as well. Even if you don’t plan to contribute a dime to your child’s college education, he or she will need to provide this information.

And here’s another thing to keep in mind. Even if your child doesn’t live with you, or you don’t include him or her on your tax forms, it still doesn’t exempt you from having to include your income on the FAFSA. For parents who are divorced, there are some other things to consider when determining which parent should be included, but one of you will definitely need to provide income information if your child wants to receive federal financial aid.

As for the Pell Grant question, there’s no simple answer. Pell Grant funding is based on several factors, including your Expected Family Contribution (EFC) and the Cost of Attendance (COA). To get an estimate of what your child may be eligible to receive, check out the 2014-2015 payment schedule provided by Federal Student Aid.

In January, a new schedule will be available, as will the new FAFSA for the 2015-2016 school year. Be sure your child completes it, regardless if he or she qualifies for a Pell Grant or not, because it is the key to other federal financial aid, including low-cost federal student loans and work-study opportunities, as well as institutional financial aid, such as grants and scholarships.

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