<p>A few years ago I met someone who was supposedly a FAFSA expert. She said there are a few things I could do to get around some of the FAFSA questions in order to reduce our EFC. I suppose they were legal back then but not ethical. I will leave it up to you to decide if you want implement any of them. Here are the ones I remember as they might apply to the OP:</p>
<p>The son can “gift” up to $13,000 per year to his sister. Her assets are not included in the EFC calculation.</p>
<p>If the parents have an Equity Line of Credit on their Principal residence, the son could gift money to the parents to pay down the line.</p>
<p>He could also gift money to a grandparent. After that, a payment made by a grandparent directly to the college is excluded from the IRS “Gift” Rule, so it would not be counted as income to the son or parents.</p>
<p>If you are self-employed, you can reduce your income by paying your children BUT they must actually do the work for which you are paying them AND the amount you pay them must be reasonable for that work. The IRS has rules for this. Note, this only helps the current EFC formula uses a higher percentage of the parents’ income than the son’s income.</p>
<p>Those are the few I remember.</p>
<p>All in all, the OP seems to be much better prepared than most of us out there.</p>
<p>Note, while the Fed’s lending rate is something like 0.25%, the effective rate for a Parent Plus loan from the Federal Government is a whopping 9.2%! (That’s 7.9% plus 4 points). It seems that a lot of groups enjoy a slice of that. It certainly doesn’t appear this loan has a goal of making college affordable.</p>