<p>It’s the self employment loss. </p>
<p>One college is accepting the AGI from the 1040, which is substantially reduced because of the father’s business loss. ($120K-$50= $70K - if there is another kid in college, that might bring the family into Pell range.)</p>
<p>The other college figures that a business that loses $50K per year is a hobby, not a job, and probably is completely disregarding it. (They are seeing that the dad can afford to blow off $50K year on an unprofitable business, and figure that if he really wanted to, he could shut down the business and use that money to pay for his daughter’s college instead).</p>
<p>OP: go with the college giving you the better aid. I’ve checked your other posts and I know which colleges you are talking about – I think you will be very happy with the other college, which has a very large endowment and a history & reputation for being generous with financial aid.</p>