FASA & Bank Account Question

[Rose673]

<p>Hey guys! I'm filling out my FASA application right now and I have a few questions. Just to give some background, my family owns a small business that makes less than $35,000 a year. Just this year (this month), we formed a partnership with another person, so split 50/50. And I am a dependent minor so I suppose my financial status will be determined by my parents.</p>

<p>1) Do I have to file the store as part of the net worth of business/farm investment? Because right now, we only have 50% of the store. But in 2011, we had complete ownership of the store. Since we're using numbers off of the 2011 tax return, we have to think in terms of 2011, correct?</p>

<p>2) When the partnership was formed, the partner paid us money for part of the store. Right now, there is about roughly $46,000 in her personal bank account. I understand that I'll have to report these numbers but how much will that $46,000 hurt me in terms of financial aid? Isn't there something about asset protection? Does this fall under it? </p>

<p>I really wish my mom didn't form the partnership til after I filed FASA :/</p>

<p>What if my mom was able to transfer the money to somewhere else? like the business account? I'm worried.
Please help! Thanks in advance!</p>

[happymomof1]

<p>Google “EFC formula 2013” and you will find the link to a PDF of the formula itself. Print that out and work through it on paper with your mom. That way both of you can see what factors most affect your EFC.</p>

<p>Good luck!</p>

[Erin_s_Dad]

<p>I’ve read that parent assets are assessed at 5.6% so the $46K would be equivalent to an EFC offset of $2576.</p>

[thumper1]

<p>Parents also have an asset protection allowance so some of their assets would fall in that amount.</p>

[geeps20]

<p>I believe a business with under 100 employees is not counted for FAFSA</p>

[sk8rmom]

<p>Assets are always reported as of the date that FAFSA is filed, so the ownership in 2011 would not apply. It doesn’t sound like the payment your mom received is a business asset but, if it is, it doesn’t make sense to keep it in a personal account. Please read the actual FAFSA instructions regarding small/family-owned businesses:</p>

<p>

90. Net worth of business and/or investment farm. Business or farm value includes the current market value of land, buildings, machinery, equipment, inventory, etc. Do not include your parents‘ primary home. Do not include the net worth of a family owned and controlled small business with not more than 100 full-time or full-time equivalent employees.
    Business/Farm Value – Business/Farm Debt = Net Worth of Business/Farm
    For business or investment farm value, first figure out how much the business or farm is worth today. An investment farm is a farming business where the parents do not reside on the farm, nor do they materially operate the farm.
    Business or investment farm debts are what your parents owe on the business or farm. Include only debts for which the business or farm was used as collateral.
    Subtract the amount of debt from the value. Indicate this amount in Question 90 for net worth of business and/or investment farm.
    To report current market value for a business, your parents must use the amount for which the business could sell as of the date of the application. Also, if your parents are not the sole owners of the business, they should report only their share of its value and debt.

</p>

<p><a href=“http://studentaid.ed.gov/students/attachments/siteresources/2012-13CTF.pdf[/url]”>http://studentaid.ed.gov/students/attachments/siteresources/2012-13CTF.pdf&lt;/a&gt;&lt;/p&gt;