<p>Similar to another poster's question, but I want to make sure I'm really clear on this.
I'm also working from end-of-year statements for a CSS deadline Jan. 15. Is Earned Income from Work for CSS and FAFSA exactly the same as gross pay (which in my case includes taxable wages, nontaxable wages, and tax deferred wages)?
The nontaxable wages are about 30% of the total gross pay--is that a good thing or will it just increase the EFC?</p>
<p>It should include all three. Because the formula uses this figure to calculate how much SS tax you paid, see if you paid SS tax on those wages (I'd guess you did). If in doubt, include all of them-- higher figure the better in terms of estimating this figure for financial aid. Correct it later if it was wrong.</p>
<p>Nontaxable wages are still wages, so they should also be include in the estimated AGI, and you likely did pay SS tax (but not income) tax on them. So, to the extent that it lowered your income tax liability, it will raise your EFC slightly because the income tax you paid gets deducted from the available income in the formula. But on balance you're still probably ahead having the lower tax liability.</p>
<p>I'm looking at my 2005 return and the accountant did not include nontaxable wages in the AGI (1040 line 38). Do you think that was an error?</p>
<p>If he was correct and nontaxable is not included in AGI, that would make the AGI that I report quite a bit lower than the Income from Work. Could that be right?</p>
<p>I don't have a 1040 handy at the moment-- your accountant probably knows what he's doing, though-- they often don't know much about the finaid process, but usually have the 1040 form down cold. Yes, your AGI can be considerably lower than earned income.</p>
<p>Thanks for your help, SBLAKE!</p>
<p>But there is another place to enter the non taxable income I'm afraid. My husband is receiving his SS pension - it is not taxable with our AGI but is considered on FAFSA (worksheet A I think)</p>
<p>Oh, I know it will be factored in (I guess in the Earned Income part).</p>