Hello everyone,
I’ve searched through a few threads on this forum and have not seen anything that treated my issues precisely, I hope you can help.
I am told that my EFC is far higher than it should be, there is clearly an error on my parents part when filing their fafsa. For a family of 5 that makes less than 100k, single-family house of 350k with 90k left to pay, no farm, no assets, small retirement fund, no savings- our EFC came out to 56521. Yes, I know there was an error on our part somehwere.
Our problem is both parents are unable to knowledgably fill out the fafsa. I don’t blame them as they didn’t go very far in school and they are doing the best they can to help. I’m probably the worse person for the job as I was never very good with any of the economic jargon.
Question: Is there an internet service that we could pay to direct us in filling out fafsa? One of my parents was considering asking his HRBlock broker when he sees him next week to see if he’d consider coming over on his personal time but he doubts any of their brokers would consider such an unheard of task. Fafsa is supposed to be generally easy to do but we are unequipped for it since he had a very difficult 2015 tax year with the selling of a rental house while living in a separate house. I wish there were a way we could use our 2016 year instead since it will be a straightforward easy tax return but I have been told that we would only be allowed to use 2015.
@mom2collegekids The income from that house was so low they were about to go bankrupt that’s why they sold it at a loss. So I don’t think it was because of some exorbitant profit.
I will print it out and go through it line by line but I don’t think we will see anything different since we didn’t know what we were doing the first time we went line by line through it.
@suzy100 I agree that there might be something related to the sale of that house caused this issue since it required more financial jargon than we knew how to handle. The amount of paperwork in the incometax forms was more complicated than the typical family has to go through.
You could just ask someone to help you -a friend from school, someone from church. It is not difficult. You will need your tax returns from 2015, current bank statements, a list of any assets not in the bank. Enter each section carefully. Do not enter cents, just whole dollar amounts.
Go through your FAFSA line by line, and if you’re not sure about any entry, come back here and tell us which FAFSA question and we will tell you what FAFSA is asking for and where to find the information.
@mom2collegekids just want to confirm, eventhough we get the 2016 incometax done in a few weeks from now, they will only accept the 2015? Is that correct?
Our local community college has scheduled evenings where they help people fill out the FAFSA. You may want to call your community college if there is one nearby.
You need to go over your FAFSA LINE BY LINE. So print it out…and…Look at every entry.
Make sure the decimal point is in the right spot. You don't want $10,000 where it should be $1000.
If I were betting, I would bet your parents put the income they earned in BOTH the parent and student sections of this form. Check to see what is listed for student income. It should ONLY be income you, the student, earned.
Are you saying your parents came away from the sale of that rental property with NO money?
What was the value of the rental property, and how much of a mortgage didmthey have on it?
How much did your family earn in rents from the rental property in 2015? Is that included in the $100,000 income you mentioned above.
Ask your for help from your high school or a college you are applying to. Most financial aid officers are more than happy to help you find a mistake if you ask nicely.
Echoing the recommendation to talk to your HS guidance office. I live in a small state without a lot of services, but even my state has an officer where staff will help you navigate the financial aid process for college. So there could be one in your area, too. Good luck!
It turns out that the 100+k profit from the sale of the house went to refinance the current mortgage so that’s what skewed the net price calculator. It is money we don’t have and can’t use since he refinanced the house with it to lower the monthly. He got rickrolled by uncle sam and had to pay about 25k back taxes because of the income, Super rickrolled.
I don’t blame him though, he has gotten this far without an education and has never complained in his life as far as I know him, he is more than appreciative for any penny he has and refuses to do anything unethical.
We’ll make do with what we can.
I encourage you to contact the schools to see if you can file for a special circumstances (professional judgment) review. If you can show that the money went toward another house, they may remove the income from your AGI. That may or may not help you, but it is worth it to talk to the financial aid office at each school you are considering. I can’t promise that every school will do the adjustment, but it is certainly within the scope of reason that they could. It’s worth trying!
Back taxes- do you mean income taxes on previous year’s earnings which were not paid on time, or property taxes on the rental house?
It doesn’t sound as anyone got “rickrolled”. Your local municipality sets property taxes to pay for police, firefighters, etc. (that’s not a national function). If it’s back income taxes, then not sure why the tax bill came as a surprise.
Nevertheless- agree with the advice to find someone at a local community college, a volunteer from an organization in your town that helps folks with tax issues. You don’t need to spend money on H&R Block- if you don’t have a lot of assets, your taxes are going to be very straightforward, even with the sale of the property.
Does your HS conduct a financial aid night? Ours does- and some very competent professionals (accountants and lawyers) volunteer to help people understand their tax form and how to fill out the FAFSA form correctly. People make mistakes with all sorts of stuff- disability payments, child support, settlements from an accident… see if you can find someone savvy to help your family sort this out.
The 100k went to refinance? Is the home you did that for under water? Meaning, the mortgage was higher than the home’s value?
HRBlock likely won’t know how applications for college fin aid work.
Be sure you did not overstate the market value and equity in the remaining home. Be sure they did not report money locked into retirement (eg, an employer plan) as “assets.”
And take kelsmom’s advice. You don’t want to speak with just the person who answers the phone, but a rep who’s part of decision-making, who will understand your particular problem.
I am confused. Did they make a 100k profit on the sale of the rental property or was that the proceeds of the sale. A profit means that the house was worth 100k more when they sold it than when they purchased it. Profit is a real problem in my opinion. This is in one and your parents chose to use it to pay down the mortgage versus keeping it to pay for College. What they really need to do is go get a hone equity loan to pull that money out and pay for College. I know others will say this is debt, but to me it is debt they already had.