I know you can file your FAFSA using estimated numbers, but will schools actually use the estimated numbers to send you your financial aid package, or will they put it on hold until you actually file and confirm your income? Will not actually filing until April delay or be bad for my financial aid package in any way?
I’m asking because I owe some taxes this year, but I won’t be able to pay it for a while. I do know exactly how much I made though, so I used exact numbers on the FAFSA. Also, if anyone happens to know, can I file my taxes now and pay later without penalty (before April 15, of course)? I’m planning to e-file if it makes a difference.
Actually waiting until april to file will definitely hurt you in the financial aid process because even schools with deep pockets have financial aid budgets and those that miss the deadline risk not receiving aid.
You will not receive any actual money until your income is verified using either the FAFSA data retrieval tool (which you cannot do if you owe taxes) or submit a copy of your IRS transcript.
Any finaid award a school sends you based on estimated numbers will be an estimated award. Final awards are based on final income numbers, i.e. after you’ve filed taxes. If your fafsa is selected for verification, filing but not paying the amount owed will delay you being able to use the IRS Data Retrieval Tool to satisfy verification as will waiting to file in April. Yes, you can file now and pay before April 15 but doing that won’t help in getting a final award if your fafsa was selected for verification.
Okay, thanks guys. I’m a little confused about the IRS Data Retrieval thing though. My school requires students to use it. How come I wouldn’t get a final award if I filed now and payed later? I just did my taxes today, so it should be in the system soon (with final numbers and everything). I would guess that my school won’t even have the ability to tell if/when students pay their tax bills. They just care about official income numbers anyway, right?
Your FA award will not be finalized until they get the IRS data verification done. Your award will be a forecasted one until then. The schools don’t care when you pay taxes. They are verifying income and assets.
But I can do the IRS verification any time after I file, right? I don’t have to wait until I pay in?
(Annoyingdad said “If your fafsa is selected for verification, filing but not paying the amount owed will delay you being able to use the IRS Data Retrieval Tool…” so I’m a little confused.)
You said that your school requires that you use the IRS Data Retrieval tool. When you file electronically, your tax return is accepted within a few days. However, returns filed electronically with a balance due may not be processed by the IRS until May. It takes two to three weeks after the return is processed until the IRS Data Retrieval Tool will work so you could be waiting until June for your financial aid to be finalized.
https://studentaid.ed.gov/fafsa/filling-out
Scroll down to **When Will My Tax Return Information be Available using the IRS DRT?
Ugh. Thanks for clarifying everything, everyone. I’m gonna borrow some money to pay them then so I can get my financial aid finalized as soon as possible.