<p>My husband's initial W2 was incorrect but we had schools that had very earlier deadline dates so we did the FAFSA initially with will file data. Once we got the corrected W2, we filed our taxes and corrected the FaFSA. ALthough our true income was $2439 less than I had guessed on the initial FAFSA, my corrected one increased our EFC by $996. WIth the drop in income, we also had a drop in taxes of $637 but that still doesn't explain why less income of almost 2500 leads to a rise in EFC of almost 1K. Anyone care to explain or can tell me what to do about this? </p>
<p>I did copy out the two forms and the only differences are the income, the tax paid, and a slight difference in our AGI based on a tuition deduction we filed which reduced our AGI by 187.</p>
<p>I decided to call FAFSA and talk to a person. She had to go away to talk to someone about what was going on. It is a bad fluke in the program. Basically if you drop your income by a little bit, your EFC goes up by some- in our case almost 1K. It appears to be a fault of the system because of my husband’s combat area pay which is not taxable. The counselor at FAFSA agreed that the algorithm is messed up for military and told me to contact the colleges directly. SO far, I have talked to two who are FAFSA only. They both were sympathetic and thought the error was really stupid. In one case, I am sending a letter plus copies of the SAR (both of them) and in the other case, I am sending a letter plus the 1040A copy with no additional schedules or worksheets. </p>
<p>The federal government has no real reason to fix the problem since probably almost all military have incomes too high for Pell Grants but most of us are stilll eligible for subsidized Staffords if the institution costs enough- the change in EFC doesn’t affect our federal benefits. However, since the FAFSA is also used by colleges, the error can negatively affect how much aid a military dependent receives.</p>
<p>Kelsmom, I just want to say how appreciative I am of the time you take to share your expertise with those of us on the forum. For me, the links you’ve provided to the solid resources like the one above have been especially valuable. Thanks again! --megan</p>
<p>I went to site that Kelsman gave, did all the calculations, and got an even higher EFC than we got from FAFSA. I do see where the strange glitch is so that our lower income results in higher EFC. I think I will send the two colleges that I have already talked to, explanatory letters. I will also talk to all the PROFILE colleges and let them know than our income for taxes actually went down and give them the corrected figures. Thanks for the help.</p>
<p>Combat pay has to be included in untaxed income. You will get a higher EFC if you are shifting income from taxed to untaxed in the formula. It sounds like that may be the case here. If it is, no adjustments will be able to be made for federal aid purposes. The EFC formula itself cannot be altered. Since untaxed combat pay is part of the formula, colleges cannot exclude it from the formula for federal aid purposes. There are many unfair things about the formula, but aid administrators must work within the formula and federal regulations. </p>
<p>As for the difference between your figures & the FAFSA EFC: working through the formulas manually can be tricky … it’s easy to make small mistakes that end up having a noticeable effect on the EFC.</p>
<p>It makes no difference at the end, I think. For federal aid purposes, the only question is whether we qualify for subsidized or unsubsidized loans. With both figures, the SAR said we very well may and I think whether we do depends on the cost of the school. One is less than our EFC and the others are more. At least two colleges have already awarded her more merit aid than we would have gotten according to financial need. It will be interesting to see what some of the more expensive schools offer her.</p>