Income and Loans

<p>I'm in grad school full time (Independent Status) and got a job to earn extra cash. I started in the Fall and got all of my loans approved for this current (2010-11) academic year. My first semester is done and my first set of stafford loans for that semester were disbursed at the beginning of the school year. I do get a refund check to help out with my living expenses too. </p>

<p>My second semester is starting in a couple of weeks and my loans for this coming semester is in the process of being disbursed. I understand that for the 2010-2011 FAFSA aid year, the base year used for decisions to determine EFC is 2009. I did not file income taxes in 2009 because I did not earn any income. So basically I had no job in 2009 so when I filled my FAFSA out, I did not declare any income and was given an EFC of zero. </p>

<p>So now that I am still receiving loans for grad school, but am earning money through working, do I need to let my financial aid office know that I am earning money now even though my loans are already approved for the rest of the year? Will this affect any loans I get for the remainder of the school year? I still need the loans cause what I earn is not enough to pay for grad school and living expenses. </p>

<p>Someone told me that I don't need to relay this information until I renew my FAFSA for next year and that my earnings would only affect my EFC for next year only and not this year. So I'll be filing income tax for 2010. I just want to be on the safe side cause I don't want to make the Fin Aid office mad by not telling them I am now earning some money. Any thoughts?</p>

<p>I think you’re fine…they will not change your EFC for 10/11 because it is based on 2009 income. In any case, you’re receiving loans and not grants and the limit for loans is based on your school’s COA, not your EFC. When you file your 11/12 FAFSA, your EFC may change due to your 2010 earnings. Independent students with no other dependents have an income protection allowance of $8550, plus various allowances for taxes, built into the EFC formula. Above that, 50% of your income will be included in your EFC. Your EFC may affect the split between subsidized and unsubsidized Stafford loans if your income is high enough (sub loans are awarded up to the limit based on financial need…need = COA - EFC).</p>