CSS & FAFSA help please

Paying for College
1

<h1>1 "This parent has an IRA, Keogh, or other tax-deferred retirement plan." (yes or no)</h1>

<h1>2 "This parent has another retirement plan." (yes or no)</h1>

<h1>3 "Enter the total current value of this parent's tax-deferred retirement, pension, annuity, and savings plans. Include IRA, SRA Keogh, SEP, 401(a), 401(k), 403(b), 408, 457, 501(c) plans, etc."</h1>

<p>My parents have a roth ira. Do I need to report this on any of the questions above. I don't think that roth ira's are "tax-deferred." Does anyone know?</p>

<p>And also the Fafsa asks:</p>

<p>"Total amount in payments to tax-deferred pension and savings plans (paid directly or withheld from earnings), including, but not limited to, amounts reported on the W-2 Form in Boxes 12a through 12d, codes D, E, F, G, H, and S (question 95a)" </p>

<p>Once again, Do the payment my parents made to their roth's need to be included.</p>

<p>If the Roth IRA funds do not need to be reported, why not?</p>

2

<p>
[quote]
And also the Fafsa asks:</p>

<p>"Total amount in payments to tax-deferred pension and savings plans (paid directly or withheld from earnings), including, but not limited to, amounts reported on the W-2 Form in Boxes 12a through 12d, codes D, E, F, G, H, and S (question 95a)"</p>

<p>Once again, Do the payment my parents made to their roth's need to be included.

[/quote]
</p>

<p>No you don't report the payments your parents made to their Roth. Payments to tax deferred plans are deducted before the AGI on a tax return so reduce the income that is reported to FAFSA. FAFSA wants to know about that income as it is considered available income. It is reported so that it can be added to the AGI by the EFC formula. Contributions to a Roth are not deducted from income so are included in the AGI you report on FAFSA - nothing to add back.</p>

<p>Roths are not tax deferred. The balance in a Roth account is not a reportable asset on FAFSA. It is reportable on CSS.</p>

3

<p>Thanks, but what about the CSS profile questions:</p>

<h1>1 "This parent has an IRA, Keogh, or other tax-deferred retirement plan." (yes or no)</h1>

<h1>2 "This parent has another retirement plan." (yes or no)</h1>

<h1>3 "Enter the total current value of this parent's tax-deferred retirement, pension, annuity, and savings plans. Include IRA, SRA Keogh, SEP, 401(a), 401(k), 403(b), 408, 457, 501(c) plans, etc."</h1>

<p>Is the roth considered "another" retirement plan?
Why woudn't they want to know the total value of the roth?</p>

4

<p>At his age, husband is REQUIRED to contribute 10% to his tax-deferred plan (employer also matches). Is this worth a note to FA offices? That money is certainly not available income.</p>

5

<h1>1 "This parent has an IRA, Keogh, or other tax-deferred retirement plan." (yes)</h1>

<h1>2 "This parent has another retirement plan." (no if all he has is a Roth)</h1>

<h1>3 "Enter the total current value of this parent's tax-deferred retirement, pension, annuity, and savings plans. Include IRA, SRA Keogh, SEP, 401(a), 401(k), 403(b), 408, 457, 501(c) plans, etc." (Give the value current value of the Roth if that's the only plan the parent has)</h1>

<p>Some colleges using Profile want to know the entire value of the parents' retirement accounts. I'm assuming it's because this is a factor in how much discretionary income the college thinks that the parent has available: parents with relatively healthy retirement accounts might have more discretionary income than those with little or no retirement accounts. Ultimately it's up to the college how this information is used in their calculation of need (ie it's a mystery).</p>

6

<p>Is parents’ retirement account balances listed in line 90 of current investments, or as tax-deferred pensions? Do they want total balances cumulative, or current year contributions?
Parents have done traditional iras until 2009 when they did roth. Do I report traditional ira balances?Where? What about roth contributions?</p>

7

<p>Retirement accounts are not included in line 90. There is nowhere on FAFSA that you report IRAs, either traditional or Roth.</p>

<p>You do report deductible contributions to IRAs made in 2009 on line 93.</p>