TLDR; can i use 2013 tax information for FAFSA and CSS profile even if it is way different now? I was told I could send the 2014 one later when it comes out
OK here’s the situation. over the past year, my dad started an assisted living business. so for 2013 he had 0 income but now over the past year, the business has started and he now has income (how much exactly, idk). also we bought a house for assisted living THIS YEAR so our real estate value goes way up (now have 2 houses for assisted living instead of 1).
My dad said he has to get so many things in for the 2014 tax filing, and could not finish on time. He said that his tax person (lol the terminology) said it was OK to use 2013 tax information and told me not to worry about it since he can “edit” or as my brother said, send another “final draft” to FAFSA and CSS Profile once the 2014 one actually comes out.
Your actual financial aid will be based on your family earnings from 2014, not 2013. If you are going to complete the FAFSA using a “will file” status (meaning you will file but haven’t done so yet), you would be wise to use BEST estimates for actual earnings, assets,and taxes for 2014, not the $0 income for 2013.
^ Agree. At the end, the FA will be based on the 2014 tax information. They allows using 2013 tax information to accelerate the process if you do not expect any big change. There is no point to enter the 2013 info in your case except that you will have an earlier submission date. If you can have a better estimate for 2014 tax info, you should use that instead.
If you have last year’s information, it is ok. You will not receive any actual money until you turn in 2014 tax information. For the CSS Profile you will need the 2014 tax information to get an accurate institutional aid package.
Rich…you might get an estimated financial aid award based on those 2013 figures. BUT the school will not finalize and disburse your award until you actually file your taxes with the 2014 data.
Since your 2013 income was substantially lower, your estimated aid package could be much higher than what you will really get with your actual 2014 figures. You want a financial aid package that is accurate…as accurate as possible. If you use good estimates for 2014, your estimated package will be closer to your actual one.
So…are you saying you already submitted using the very low 2013 figures? Your actual aid won’t be based in that…at all.
Thumper… I’m sorry for disappointing you. I have failed. I DID send it (oops). But it shouldn’t affect the overall financial aid, right? Will I be getting my ACTUAL aid before May 1st so I can make the best decision possible before committing?
If you update with the accurate 2014 info in a timely fashion…yes, you will get your actual aid based on your actual figures.
But do try to get it done as soon as possible. If you are selected for verification, and have to send in additional documents, that can slow the process down.
The problem is if you decide to attend Pricey School based on the tentative aid package, but then find the school unaffordable after you submit accurate 2014 information.
I want to address this statement: “also we bought a house for assisted living THIS YEAR so our real estate value goes way up (now have 2 houses for assisted living instead of 1).” If your family is not living in the house and it is being used solely for a small business (family owned and less than 100 employees), it would be a business asset … not a parent asset. You wouldn’t need to report that on FAFSA. It’s different than if you have a second house that you are renting out to make money … this is part of an actual small business, and FAFSA allows you to skip reporting the value of a family owned business with less than 100 employees.
The small business exclusion establishes the following criteria for a small business to be excluded from assets on the FAFSA:
Small business with 100 or fewer full-time equivalent employees. The size of the business is based on the number of full-time equivalent (FTE) employees, not the income or assets of the business. Two half-time employees are counted as the equivalent of one full-time employee.
Or any part of such a small business. Any assets owned by the small business are also excluded as assets, in addition to the business itself.
Owned and controlled by the family. The small business must be owned and controlled by the family. This means that more than 50% of the voting rights must be owned by the family. The family members do not all have to be counted in household size on the FAFSA, but must be directly related to or related by marriage to people counted in household size. (If there is more than one class of stock with different voting rights, the family must own more than 50% of the voting rights in order to control the business.)
If the small business is a partnership where each partner owns exactly half of the business, and the family is one partner and a third party is the other, it does not qualify for the small business exclusion. In order to qualify, the family must own a majority of the business (more than half). Otherwise, the family does not control the business and must report it on the FAFSA as either a business asset or an investment. If they own 51% it is excluded; if they own 50% it is not excluded.
The problem is if you decide to attend Pricey School based on the tentative aid package, but then find the school unaffordable after you submit accurate 2014 information.
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Exactly. What good will it do you to get some fab pkg and think a school is affordable…and then get all the aid taken away once they see your dad’s real income and assets???
I have a similar question - I just filed our FAFSA and realized our asset figure was off by approximately $14,000 - it should be $14,000 less than I noted on FAFSA. Is there a way to correct that? We still have to update to our 2014 taxes so should I wait and correct the assets when the official 2014 taxes go through? (Did the FAFSA based on 2013 taxes - which will be very similar to 2014 taxes - but did use the “will file” option) Any advice is appreciated.
If you made an error reporting your asset, you can change it. You cannot change it if you spend money after the filing of your FAFSA. Be prepared to document the actual amount of the assets as of the date of your initial submission. Because you are lowering that amount, you could be asked to provide documentation that the amount ypunare changing to is accurate as of your initial filing date.
But yes…if it’s a mistake, the asset amount can be corrected. Corrected.