Coop income question.

Parents Forum
1

<p>D is in her first session of a coop. How does coop income affect her status as a dependent for income tax purposes? Also am I correct that it does not count as income for the purposes of determining EFC when filling out the FAFSA? I hope this the correct forum. It's not directly about financial aid.</p>

2

<p>How long is the co-op term? I’m not sure on the dependent question, you would have to check the rules, I thought it was if they support themselves for more than 6 months they were not a dependent, not sure how it would be affected if they are still considered a full time student. I believe co-op income is treated as student income for FAFSA, they have to pay taxes on it like any other income, can’t see how it would not count. When I was co-oping 30 years ago I made enough to support myself.</p>

3

<p>This year it will be 4 months, next year 3 months, the year after that 7 months.</p>

4

<p>The big one is that no one else claims the dependent. That includes the child claiming themselves. This may be an issue if the co-op pays well, because your daughter may be paying income tax. </p>

<p>You are safe to claim her as long as she isn’t providing for 50% or more of her support. That support would need to include all her expenses, including college fees. </p>

<p>Yes this is going to be included in the FAFSA as her income. </p>

5

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<p>I don’t think that is correct. That income is NOT financial aid. It isn’t work study. I do believe that it will count as income…however, if she earns less than 6000 it won’t change her EFC. If she earns more than 6000, then the difference will affect EFC. If she has any savings on the day she files FAFSA, that will increase her EFC…so, you should save it for her and pay things for her out of that money.</p>

6

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<p>I don’t think that is correct. That income is NOT financial aid. It isn’t work study. I do believe that it will count as income…however, if she earns less than 6000 it won’t change her EFC. If she earns more than 6000, then the difference will affect EFC. If she has any savings on the day she files FAFSA, that will increase her EFC…so, you should save it for her and pay things for her out of that money.</p>

7

<p>Actually it doesn’t count as income for EFC purposes, according to Forbes.</p>

<p><a href=“http://www.laxpower.com/update14/binboy/XGRVOH.PHP”>http://www.laxpower.com/update14/binboy/XGRVOH.PHP&lt;/a&gt;&lt;/p&gt;

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<p>Backed up by Purdue: <a href=“http://www.purdue.edu/dfa/co-op.php”>http://www.purdue.edu/dfa/co-op.php&lt;/a&gt;&lt;/p&gt;

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9

<p>Thank you OHMomof2 our D goes to Purdue and I thought I saw that somewhere. I hope this proves to be the case. She is working hard to save her coop earning in order that she can either reduce or pay off her loans. If it raised her EFC it would almost negate the financial advantage of the coop. </p>

10

<p>My D is seriously considering a co-op college so we’ve done a lot of research on the subject. Indeed having it affect EFC really would negate a lot of the benefits.</p>

11

<p>So far it seems to benefit her in a number of ways we hadn’t previously considered. First, it’s required her to find a place to live and roommates to live with. She is responsible for her portion of rent and utilities, she has to pay for and be responsible for car upkeep and repair, meal planning, grocery shopping, housekeeping, checkbooks, credit cards etc. When she first went to college she was in a cocoon. All of her daily needs were taken care of. She now has a boss, and as of the moment 4 projects. The coop group, 17 of them are very close knit. It’s only been 3 weeks but she feels classwork is more stressful than work. We’ll see if that continues. I have heard that one of the things coop students like is the break from their rigorous coursework. Good luck to your D. It’s an exciting time.</p>

12

<p>It looks like FAFSA made that change in 2012, and they now specifically ask how much was earned from co-op (so they can exclude it from other income); my s graduated from Northeastern in 2011 so we missed out on that. However, we were told that typically co-op earnings had little effect on their financial aid awards, and awards in later years would be very comparable to the initial award in freshman year, assuming no other significant changes in family contribution. And that was certainly our experience. </p>