<p>Okay, on the FAFSA, line 84 asks for my parents' adjusted gross income. Which we reported. But then my dad says that since we reported that income, we should put $0 in for father's income earned from work (line 87) and my mother's income earned from work (line 88). If we report in all three sections, it would be like reporting three incomes. He talked to the guy who does his taxes and that's what the tax guy said, I guess. I think this seems crazy, because my parents both earned more than $0.</p>
<p>Can anyone PLEASE help me?</p>
<p>Hmmm…when we did the FAFSA, I believe we did the mom income and the dad income and they almost added up to the AGI (AGI includes things like dividends/interest that are not included in income).</p>
<p>Someone else here can verify…but I believe you DO put each person’s earned income on each of those lines.</p>
<p>I think your dad misunderstood the tax guy.
If the income is all from investments or rental property, that would be right.
If the income is earned from work, then line 87 and line 88 are getting at the allocation between the two earners.</p>
<p>The tax guy obviously has no clue whatsoever about FAFSA. The question about income from work is used to calculate allowances that are only based on income from work, not other income. The main allowance is FICA. The allowance for FICA is 7.65% of income from work and is used in the EFC to reduce the income available for the EFC. If you do not report the income earned from work, as required, your EFC will actually be higher than it should be.</p>
<p>For instance if the AGI is $55000 and income from work is $50,000 then the allowance for FICA will be $3825 (50,000 x 7.65%). In the formula the $3825 will be deducted from the AGI reducing income available in the EFC formula by $3825.</p>
<p>No, the tax guy is wrong. The earned income is just treated a little differently in the calcuations than unearned income (they make an adjustment in it because of all the withholding that is taken from it – it’s more favorable to you they way they treat it.)</p>
<p>So, yes, you enter your parents’ AGI, but then break down how much of that AGI was earned income.</p>
<p>You need to report your AGI AND earned wages from W-2. Don’t worry you are not reporting the same income twice.</p>
<p>The Govt wants to know what was earned from wages. AGI can include more than that figure - i.e. social securtiy if received.
In any case - report the exact figures they ask for.</p>
<p>Okay THANK YOU all for your help. I didn’t think that sounded right, so I’m glad you all could back me up. Thanks again!</p>
<p>In case he doesn’t believe you (it IS confusing), you can show him what happens if you go to the FAFSA estimator. It only takes about 2 minutes to fill out. It’s very basic. Input all your numbers but answer that question with a zero and look at your EFC, then go BACK and enter the actual salary and look at your EFC. You’ll see it actually HELPS you. If a person ONLY has “income” that is not salary, they will not get the extra credit you get from having worked and earning a salary. There is even a special “notice” about this at that fafsa estimator (not fafsa forecaster…that takes forever). Luck</p>
<p>The FAFSA tells you EXACTLY which lines to use on the tax form. Follow the instructions.</p>