<p>Basically, I'm curious to know if untaxed income is treated the same as taxable income by FAFSA? Yes, I've done the paper calculations, but didn't arrive at an answer. But it seems like here, when people throw out incomes around what mine is and expected EFCs for that income, my actual EFC is quite a bit lower. My AGI is quite a bit lower than total income because of paid housing, which is subject to FICA/medicaid, but is not otherwise taxable income. Of course I report it. </p>
<p>Now, I'm not complaining, and in my current situation, I pay less than my EFC for D's school anyway, but I am curious and wondered if anyone here knew the answer.</p>
<p>Do you have a low enough income that you end up getting a student allowance for parents’ negative adjusted available income? That may be why it is coming out less than you expect. There are other reasons. Income is income, though - taxed and untaxed are treated the same.</p>
<p>No, we don’t have negative adjusted available income. About a third of what dh makes is designated as housing, and I have a salary, too.</p>
<p>As far as I can tell, the EFC formula just adds untaxed income to taxed income to give total income. It does not treat it any differently other than it is not included in calculations for certain allowances such as FICA. It even looks like it gets the same state allowances as taxable income.</p>