<p>Yes, the business loss is what is driving the EFC down enough to qualify for Pell. I have seen it more than a time or two with self-employment income, and the Profile EFC will often be a lot higher than the FAFSA EFC in these cases.</p>
<p>If the EFC went down when the W2 was sent to the school, I would bet a contribution to a 401k/403b was not initially entered - the school would have entered it when they received the W2 and saw it.</p>