Did I do something wrong on the FAFSA???

This is our second year filing the FAFSA. Last year, out EFC came out at around $6,500.

I’ve just completed it for this year, and the EFC is around $2,500! That would be wonderful, wonderful news because it makes D eligible for the Pell Grant, I think… but I am afraid I did something wrong. Of course, the FAFSA won’t let me back in to see my forms and double-check everything, so I don’t know. But can you tell me this seems right?

We (parents) made a bit more money this year. Student also made a bit more money this year. So I assumed our EFC would be higher. The only thing I can think of that’s different this year is that we reported the education tax credit.

Any thoughts?

Once you get the email in a day or two that your fafsa has been processed you can log back in and view your SAR. Without any actual numbers like AGI there’s no way for us tell if it seems right. The fafsa formula is at this link if you want to go through it manually. Note that students do get an income allowance of $6310 before their income counts against EFC.

http://ifap.ed.gov/efcformulaguide/attachments/090214EFCFormulaGuide1516.pdf

Thank you (again!) I’ll try working through it manually from your link.

@annoyingdad I guess I can’t use that form you linked because we don’t qualify for the simplified formula since parental income is greater than $49,999. Is there one for the next income bracket, do you know?

I found an online estimator and it gave me ~$8,000 EFC. So I must have done something wrong on the FAFSA. I guess I will just wait and see when it’s finished processing. Thanks.

That link has a regular worksheet area that is for those that don’t qualify for the simplified formula. You just didn’t see it, look again more closely. The regular worksheet is the first one in the link, pages 9-12.

Thank you, I missed that. Yeah- it looks like I did something wrong on the actual FAFSA. Drat! Thank you for your help.

Hmm. Well the FAFSA is now processed so I can see it, and it looks like I did enter all the fields correctly. I can’t understand why the EFC is so much lower than it was when I did it out manually.

Did you have less pre-tax retirement contributions? More taxes paid? You’re older and asset protection amount increased? Did student have less assets?

When you can use the irs data retrieval tool maybe you can do that and see if any fields change.

Double-check your number in college.

OK, so I went through last year’s and this year’s line by line. I cannot see any errors. It really doesn’t make sense why the EFC is lower… can anyone take a look at these differences and tell me if they see any glaring errors or any reason for the more favorable EFC? Here are the differences:

Line 29 (year in college) 2014:1st / 2015:2nd
Line 33 (student tax form used) 2014:1040EZ / 2015:1040
Line 36 (student AGI) 2015 was $3,439 more than 2014
Line 39 (student earned income) 2015 was $3,563 more than 2014
Line 41 (student cash/bank accts) 2015 was $28 more than 2014
Line 42 (student net worth of investments) 2015 was $1083 LESS than 2014 — first item that is LESS than last year!
Line 44c (students work-study earnings) 2015 was $526 more than 2014
Line 85 (parents AGI) 2015 was $8,070 more than 2014
Line 86 (parent income tax paid) 2015 $1,185 is LESS than 2014 because of the education tax credit, I believe. But wouldn’t paying less taxes increase the EFC, not lower it?
Line 88 (parent 1 income) 2015 is $5,052 more than 2014
Line 89 (parent 2 income) 2015 is $3,224 more than 2014
Line 93a (parents education credits) was zero in 2014, 2015 is $1,500 more
Line 93d (parents grant and scholarship aid) was zero in 2014, 2015 is $21,423 more

Last year’s EFC was 6,667
This years is 2,564

As you can see above, both parents and student made more money this year. Students assets are lower, but only by $1083. We paid less income tax because of the education tax credit, and the grant aid is noted.

Oh, and our FAFSA was “selected for verification” this year… and it wasn’t last year. Is that because I’ve done something wrong here?

Any thoughts?

I’m no expert like some here, but I think the error is “Parents Scholarship aid” that would be for scholarships the parents received if THEY were in school also. I think that number would go in the student section, not the parent section.

Line 93(d) indicates that you or your spouse is a student who received grants and/or scholarships in 2014. Is that accurate?

(I’m assuming that you are a parent, and not the student for whom the FAFSA is being completed.)

Did you or your student have taxable amounts of grants or scholarships that were reported on your tax return as part of AGI?
https://fafsa.ed.gov/fotw1415/help/faadef41.htm

Even for the student section, did your daughter really report $21k of taxable scholarships on line 7 of the 1040? Or is that total scholarships she received? Why did your daughter have to file a 1040 and not a shorter form?

That would indicate your daughter had a high AGI in 2013 if her AGI was only $3439 higher for 2014 and you did include $21k of scholarships/grants on line 7 of her 2014 1040. Her 2014 AGI would be $21k plus any other income if you did that.

D filed a 1040 because she received a 1099 for freelance work.

And now I think I see what I did wrong. We did NOT include that grant money in our AGI. I guess I just assumed I was supposed to enter it because we’d entered the amounts from the 1098-T on our tax return. So then, nowhere on the FAFSA do we enter the grant/scholarship money, correct?

And I see how that would make our AGi seem lower. So, presumably in 3 weeks when I can use the IRS retrieval tool, it will automatically correct that, am I correct?

Or do I need to do something else to correct that?

Thank you for helping me figure this out:)

Who was the grant/scholarship money for - the student or a parent?

You only include the grant money on FAFSA if it was taxable, and therefore included in the AGI on your tax form.

She did not have a high AGI… I think my mistake is that I entered the entire scholarship amount, when really (if I understand correctly) I should not have entered any of it because it was not more than her tuition. Right? You only enter the amount that’s over the tuition expenses? Her tuition was $40k-something and she had $21k grants. So I should have entered zero, yes?