I’m (about to be) married and applying for the FAFSA and filing taxes as such. I’m trying to afford state school at $23K/year. I’ve run out of options at community college for courses in my major and there isn’t a good school near where I live. My fiancee and I live with my parents, but want to go to school in another city. I’ve done the math and we can afford college with loans and parental contributions. Would our parents both be able to contribute financially to our college if we’re married and not hurt our FAFSA aid/ACA aid?
Monies paid by your parents, especially for college must be listed on your FAFSA. How it will affect your financial aid will depend on how much they are paying.
When are you getting married? you file the FAFSA based on your status that day. depending on your income.
IF you and your spouse have no income, you will prompt a low income verification where schools will want to know how you are meeting your day to day expenses.
As independent students any bills in your name that your parents are paying must also be listed on the FAFSA as monies paid on your behalf.
Instead, the parents could formally loan the support monies to the married couple, charge/collect interest at the applicable federal rate and report the interest income on their tax return(s), then after the last FAFSA was filed, the parents can begin to forgive the debt (at an annual rate not exceeding the gifting exclusion).
(No idea how a loan and later forgiveness of debt affect ACA).
You say you’ve run out of community college classes to take…but you posted in April that you are a freshman physics major at RPI. Is RPI a FAFSA only school? I know that some private schools don’t care if students are married and still use parent income to determine need. Something to keep in mind.
If you are at RPI, which is a CSS profile school, most schools systems in place that if you start as a dependent student, you finish as a dependent student even if you have a life event (marriage/birth or a child) that makes you independent for federal aid.
When you get married, while you will be independent for federal aid, you and your spouse will most likely be dependent students for need based institutional aid (meaning you will still receive aid based on your parents income and assets).
RPI also has that same policy in place, if you start as dependent, you finish dependent
@Madison85, I thought if someone forgives a debt, it then becomes taxable income to the debtor, is that not the case?
In this scenario, each parent can forgive each student $14000/year of debt as a gift starting after the last FAFSA is submitted (the gift is the value of the loan forgiven annually) without the parent having to file a gift tax return. Gifts are not taxable income.
I’m actually no longer at RPI; I ran out of money and came home. I’m trying to start UT as an independent student.