FAFSA App May Make it Easier for College Students to Apply for Financial Assistance by Joanie B. Stein, CPA
Posted on December 10, 2018 by Joanie Stein
Families with children preparing to attend college for the 2019-2020 academic year may have an easier time applying for loans, grants and scholarships from federal and state sources thanks to a redesigned Free Application for Federal Student Aid (FAFSA) website and the introduction of a new mobile app called MyStudentAid, which is available for Apple and Android phones.
The FAFSA application period for next fall officially began on Oct. 1, 2018. It is recommended that families begin the application process as soon as possible for two important reasons. First, some aid is awarded on a first-come-first-served basis, and the earlier families file the FAFSA, the more time they will have to review their Student Aid Reports, make corrections to their forms, if needed, and compare the offers for aid dollars that they receive. In addition, families should recognize that completing the FAFSA, whether online or on a mobile device, is no walk in the park. The form includes more than 100 questions, many of which applicants will not know the answers to without first doing some research into their finances and other personal information. The sooner families begin the process, the more time they will have to locate requested information and complete the form without significant delay.
Following are some of the steps that families can take to prepare in advance and make the FAFSA application process go as smoothly as possible:
- Visit https://studentaid.ed.gov and set up a FAFSA login ID and password for the student seeking aid;
- Know the social security numbers, drivers’ license numbers and birthdates for the student and his or her parent(s);
- Have a hard copy of the family’s tax returns from the most recent tax year and/or access the IRS’s Data Retrieval Tool on the FAFSA website or by visiting https://ww.irs.gov in order to have your tax information automatically transferred from the IRS to the FAFSA;
- Gather the most recent statements of bank and brokerage accounts, 529 college savings plans and the current value of other assets (excluding the family home), and be prepared to identify whether the owner of those accounts are the parent(s) or the student; and
- Be prepared to list at least one college that the student hopes to attend. Students can change this information or add the names of additional schools at a later date.
Finally, families should not assume that their students will not qualify for financial aid, perhaps because the parents’ income is too high. In fact, only a small portion of parents’ income and assets figures into a students’ potential aid calculation. Instead, a student’s eligibility for financial aid will be more affected by assets held in his or her own name. This is something that families should consider and plan for under the guidance of professional accountants and financial advisors far in advance of a child’s entry into a higher education institution.
About the Author: Joanie B. Stein, CPA, is a senior manager with Berkowitz Pollack Brant’s Tax Services practice, where she works with individuals and closely held businesses to implement sound strategies that are intended to preserve wealth and improve tax-efficiency. She can be reached at the CPA firm’s Miami office at (305) 379-7000 or via email at email@example.com.
Information contained in this article is subject to change based on further interpretation of tax laws and subsequent guidance issued by the Internal Revenue Service.