My son lives at home, but is considered an independent student on the FAFSA application and does not have to include parent financial information. Question 45J asks about for the amount of cash support received from a parent or other person whose financial information is not reported on this form. Talking with a financial aide counselor at his college he was told to figure up what his portion of room and board, utilities etc would be (again living at home with parents). What is the best way to determine a fair figure for the amount of cash support we provide him?
For the sake of clarification, 45j: ‘Money received, or paid on your behalf (e.g., bills), not reported elsewhere on this form. This includes money that you received from a parent or other person whose financial information is not reported on this form and that is not part of a legal child support agreement.’
Remember, how student answers this question will impact his eligibility for financial aid. The higher the figure, the lower the aid. If he received money from parents or other family or other persons that is not already reported in answer to FAFSA 41 (don’t double-report), then report it here. If student is living at home, and parents are not paying for his rent and living expenses outside, he’s not actually receiving money from them for this purpose, nor are parents paying on his behalf. If you are not charging him rent, you are not paying it on his behalf.
Another caution: The financial aid officer at my daughter’s school also clarified that she should not state here the amount of money paid out for her tuition in the previous year. She said that many students make the mistake to report their tuition paid out by parents in reply to 45j.
Here is the language from the FSA Handbook:
Money received (45 only).
The student reports any cash support he received, but if dependent he does not count his parents’ support, with one exception: money from a non-custodial parent that is not part of a legal child support agreement is untaxed income to the student. Cash support includes money and gifts and housing, food, clothing, car payments or expenses, medical and dental care, money paid to someone else or paid for on his behalf. For example, if a friend or relative pays his electric bill or part of his rent, he must report the amount as untaxed income. If he is living with a friend who pays the rent and the student’s name is on the lease, the rent paid on his behalf counts as cash support because he is responsible for payments that his friend is making.
My note: You don’t report the portion of room/board/utilities unless the bill is IN THE NAME of the student. The FAA should not be asking you to report the “value” for bills that are not in the student’s name on the FAFSA. The FAA can, however, use that information (provided to the school, not on the FAFSA) in another way … such as reducing the cost of attendance or increasing the student’s income … but this is done as Professional Judgment, by the school, if the school feels it is necessary to do so. It is not done by the student reporting it as income on the FAFSA.
This is also from the FSA Handbook, concerning in-kind support:
In-kind support is other than money, for example, friends or relatives giving the student food or allowing him to live with them rent-free. That support isn’t included as untaxed income, though you may use professional judgment (e.g., by reducing the cost of attendance or increasing income) with students who receive such in-kind support. This is not the same as housing and other allowances received as compensation for a job, which, as stated earlier, must be reported. If the student is living with someone who is paying living expenses, it can be difficult to determine whether the support is cash support or in-kind support. The basic rule is: if someone pays a cost the student is obligated to pay, the amount counts as cash support.
My note: “Obligated to pay” means the bill is in the student’s name.
Post #1: You would not report the amount the parent paid for the previous year’s tuition ONLY IF the student was dependent in that year. If the student was independent & if the parent paid tuition, that money has to be reported as money received.
I am a legal guardian & called fafsa about that question. They said the student should NOT report the value of my support such as food, housing, clothing, etc.