<p>Background. son is a junior (2014) and is being recruited by Harvard, Penn, Princeton and Brown for sports. I am self-employed with a few different businesses. Plugging numbers into the NPCs indicated we MAY get a small FA award for son's first two years while we have 2 in college. FA will depend on certain issues, so I am hoping for input from people who have had specific experience with these schools:</p>
<p>Income Questions. Will the following be added to AGI:
depreciation on rental properties
health insurance premiums paid through business</p>
<p>Asset Questions. Will the following be counted as assets:
home equity
life insurance cash value
consulting business for a one person, one customer, non-saleable business (I am concerned that FA could take net income from the consulting biz and apply a multiple to give it a value, even though the sole customer would not continue with someone else)</p>
<p>Also, will FA departments answer such specific questions before a formal pre-read?</p>
<p>Why don’t you call or e-mail the questions? I’m convinced many colleges add some percentage of depreciation back in (we generally show a small amount of rental income as gain but not a huge percentage of total rental income) but YMMV and some will add back some percentage of insurance paid through a business, but each college can do things how they like. Different colleges treat home equity differently in terms of the multiplier. I think there are threads on this topic that cover the schools you are asking about. How your business income is viewed might depend on how you have treat the business (LLC, S Corp, 1099 income on Schedule C). There are many ways to value a sole proprietor consulting biz. We own our home and rental properties and H is “self employed” and through 3 kids we have seen many variations in the private colleges determination our “need” or “lack of need” depending on your perspective, BUT we have not had to deal with the Ivy League so don’t rely on my anecdotal experience. Ask, question, and ask again if you are dealing with a sports recruit. </p>
<p>There are also threads about how people with rentals and self employed or small business are seeing results compared to the NPCs. You might want to read the threads. I would vote for the NCPs to be conservative for someone in your situation, but again your best best is to ask the questions.</p>
<p>I believe some Ivys try to develop a cash flow picture from your tax returns; therefore depreciation would be backed out since it doesn’t impact cash flow. I do not know about health insurance premium treatment. Home equity is not counted (as an aside keep in mind when evaluating the value of the rental property, the value is the sale price you could reasonably expect in a 30 day sale [i.e., quick sale] less the commission). Some schools will look at the life insurance cash value (if they didn’t, people would go out and purchase it to lower the EFC). Businesses under a certain number of employees are not assigned a value.</p>
<p>While the FA departments will not ask specific questions (apart from making sure the info is complete), when they call with the results of the pre-read, you can make your case during the call - if you are unhappy. Also, in the forms you submit there are opportunities to make your case on unique circumstances.</p>
<p>We also own a small business and the pre-reads varied widely based upon the same information. It’s not a truely transparent process; for the obvious reason that small business owners have a lot of leeway in controlling the timing of expenses and revenue.</p>
<p>My advice is to look into speaking with a reputable planner - the return the schools will look at for you is 2013.</p>
<p>^^ Brown a couple years ago was a member of the 568 group and , I think, did cap home equity…several years ago it was 2.4% x annual income… Stanford at that time was 1.2% x annual income…again, the OP needs to ask the colleges directly as things change every year or search on more current threads.</p>
<p>Thanks for the replies. I have been following these threads for a few years and they have alerted me to these potential issues when using the NPCs, but not really provided concrete, school-specific answers. The home equity cap numbers are helpful.</p>
<p>I am guessing I will have to see what specific info I can pry out of the schools (probably not a lot), but we’ll wait to make sure the kid performs well at the camps this summer and has a good chance for an offer. If I wait until he gets an actual offer for a pre-read, he was told there is a chance he will only have a week or so to accept and I don’t like to scramble like that.</p>
<p>My take from others’ general comments is that none of these questions will have answers that help our situation so if my kid gets an offer we are looking at full pay. Not complaining, just planning and hoping we have the opportunity to put this type of option in the decision matrix (he will have some great D3 options with big merit aid too). Also thankful that these are the types of things we have to worry about at this time.</p>