NYU fin aid for 0 efc

Paying for College
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<p>For simplified needs test, your income must be less than $50,000 AND you either must file a 1040A or 1040EZ OR receive one of the means tested benefits such as free lunch, food stamps, etc.</p>

<p>Simplified needs test does not guarantee an auto $0 EFC. IF you are eligible for it, you don’t have to report your assets. </p>

<p>As noted by Calmom, your EFC with the income you quoted on this thread would be above the threshold for receiving a Pell grant.</p>

<p>Someone familiar with the TAP formula would have to comment on that. I believe Sybbie already did upstream a bit…saying not to count on receiving a full TAP award.</p>

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<p>I will stick with the fafsa sar I tested with 43k agi & a 1040a that returned a 0 efc & full pell & stafford loans. tap works exclusively on nys ti.</p>

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<p>Steve, I don’t care if you believe me or not. I am a RETIRED lawyer, on my 2nd career, after 20 years of practice & graduating from a top-5 law school back in the 70’s. If you don’t want to believe what I tell you about NYU’s financial aid practices, all you would have to do is pull up past posts about financial aid in NYU forum on CC and you would learn the same thing. </p>

<p>NYU leverages its aid based on a tiered system. During the RD round, students can sometimes predict what their aid level may be, because NYU also stages two weekend events in the spring, and sends out invitations in advance of their official admission announcements. The first event is for their top, priority admitted students – those students probably get the most aid.</p>

<p>The next event is usually 1 or 2 weeks later, takes place in early April, and is for most of the other admitted students. It is a big informational event for admitted students. They give out free tote bags and other paraphernalia. They have tables set up for financial aid, where students can go and talk to a financial aid counselor. Although NYU is notoriously stingy with aid, they are also very direct and honest with the students when discussing aid. They tell the students up front that they will not make changes based on details of their financial circumstances, but that the student can submit an “appeal” and will get an answer within 2 days. They tell the students that the likely outcome of the appeal will be an increase in their grant of $1000 or $2000. It is very typical for NYU to give an aid package with a $9,000 grant and then when the student “appeals”, increase it to $10K. They do not do that based on needs analysis but simply as a function of enrollment management. </p>

<p>It is very easy for students to compare notes in that context, and of course it is a hot topic on CC every spring. So it is pretty easy to see how NYU operates.</p>

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<p>Okay…no problem…</p>

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<p>Calmom, the Auto 0 formula requires an AGI - not total income - of $31K or less. I believe that’s the piece of the puzzle that you’re missing. Tax exempt income is not included in AGI. His AGI seems to be $27K which, coupled with that 1040A filing, qualifies him for Auto 0. Under the Auto 0 formula, no untaxed income is counted. Works that way for everyone…I don’t think NYU can do anything to change the EFC because, even if they did enter info in the untaxed income or asset fields, the FAFSA would still process under the same formula.</p>

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<p>You will find the EFC formula guide here: <a href=“http://www.ifap.ed.gov/efcformulaguide/attachments/101310EFCFormulaGuide1112.pdf[/url]”>http://www.ifap.ed.gov/efcformulaguide/attachments/101310EFCFormulaGuide1112.pdf&lt;/a&gt;&lt;/p&gt;

<p>You can use the worksheet to calculate EFC rather than an online calculator.</p>

<p>Here is how the numbers come out for a $43,000 AGI (no assets considered):</p>

<p>Line 7, total income: $43,000</p>

<p>Subtract out these amounts:
Line 8, total US Tax paid: -0- (you can add what you actually paid in taxes – since you are the head of household with only $20K of taxable income and 1 dependent, I am assuming you owe nothing in taxes – if I am mistaken, then you can redo the numbers and subtract the total taxes paid from the line 7 amount).
Line 9, state and other tax allowance: $3440 (from table A1 - NY=8% of total income)
Line 12, income protection allowance: $16,230 (from table A3, assuming a household size of 2, you and your son).
Line 14, Total Allowances: $19,670</p>

<p>Line 15, available income: $23,330 </p>

<p>(Assets skipped for purposes of this calculation)</p>

<p>Parent’s contribution:
Line 25, Adjusted available income (AAI): $23,330 (same as line 15 above- would be higher if assets considered)
Line 26, Parents contribution from AAI: $5,674 (From table A6, $5,188 + 34% of AAI over $21,900; 34% of 1430=$486; $486 + $5188 = $5674)</p>

<p>Pell grant eligibility for 2011 cuts off at $5275; $5674 is more than $5275 – hence a single person with one child in college and an AGI of $43,000 would not be eligible for a Pell grant.</p>

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<p>The worksheet as I read it does not represent the application of the formula online. I put in 43k as my agi and left everything the same. Still got 0 efc. You can opt out of giving assets & untaxed income as well.</p>

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<p>Calmom, I know how to calculate via the worksheets but you’re STILL completely missing the point…the ONLY income the AUTO 0 Formula will look at is AGI. The tax exempt interest is not included and that question is not even asked once the criteria for Auto 0 has been met. In other words, Auto 0 means that the normal formula found in the EFC Formula Guide is not used at all.</p>

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<p>sk*rmom, if i am not mistaken, she was saying I was manipulating the system by having 15k in untaxed income which artificially lowered my agi below the 32k mark. Then I would not have to report the untaxed income. That’s how I was supposedly manipulating the system. I think she knows what you are saying…</p>

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<p>Okay…and I suppoese every other family who qualifies is manipulating the system by having their untaxed income excluded. It doesn’t make any sense to cry foul because that is clearly the way the formula was designed… You do report the t/e interest on your return, it just isn’t included in AGI, correct?</p>

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<p>That’s correct. Personally, I try to figure out what they wanted when they wrote the formula. I assume they did not consider every possibility. With t/e income, to the extent you do not fall under the amt with say 60k, and you can keep your agi below the 50k mark, I would think the people who wrote the formula would want to consider that as 60k. It would come out as less than 50k because you could file a 1040a. I suspect somewhere in the middle of paying for college your income would fall below the 50k mark and they would then give pell grants, etc. Basically, the assets get protected once they generate less than 50k. Personally that is the way I would look at it. You may differ…</p>

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<p>Remind me again why this large amount of interest income is tax exempt.</p>

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<p>Municipal bonds…</p>

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<p>No, they aren’t “manipulating” – please read my post above about professional judgment. The colleges have the express legal power to ask for additional documentation of matters not reflected in the FAFSA, and to exercise their own judgment to change data on the form to reflect the individual circumstances when there is enough of a deviation from the norm to warrant that. </p>

<p>Most people do not have a very high amount of untaxed investment income, so most of the time there is no “special circumstance” and no reason to deviate from the norm. </p>

<p>Thumper - the reason the income is tax exempt is that they are invested in municipal bonds. I may be mistaken, but I think most of the time you need to have a very large amount of money available to invest in municipal bonds in the first place – that is, I don’t think those bonds are sold in small increments, but rather that investors might be buying bonds that are $10,000 or $50,000 or even higher than that. So you aren’t typically going to see municipal bond income as an “untaxed” source for lower income people.</p>

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<p>Why do you think it matters that the untaxed income is interest income instead of child support? Remember, one could be receiving $10K or more a month in child support and still qualify for Auto 0 if the AGI and tax filing met the criteria.</p>

<p>I don’t think any professional judgement is warranted nor do I think it would have any effect on whether the student is Pell eligible or not. Just as schools cannot rewrite tax law, they also cannot change the basic rules that govern FAFSA processing. As I said, they can put ALL of the untaxed income and ALL of the assets into the data fields, and I’m willing to bet that his FAFSA will still process as Auto 0. You seem to think they can somehow disqualify him on the basis of his tax filing. But what would be their motivation to do so? It’s beyond reasonable and the student would certainly have recourse through the federal ombudsman’s office.</p>

<p>Btw, you do not need large amounts of money to invest in municipal bonds. There are many tax-free mutual funds that do this.</p>

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<p>Since I have been called a "■■■■■’ and a “poser”, for posting on a federal holiday, when “the kids are out of school”. (Why this is relevant, I have no idea). I would like to point out the following.</p>

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<p>ED is the official acronym for the Department of Education… ED. Calmom, if you are going to refer to a government agency, at least get it right. This is a pet peeve of mine esp coming from people posing as such experts. I don’t think the Dept of Energy (DOE) would be concerned about Steve’s situation.</p>

<p>To upstatemom and to those who show so little faith in their child’s ability to fill out the FAFSA. Most of the questions on the fafsa give the EXACT line number to answer each quesiton. I mean, come on?</p>

<p>'“What was your parents’ adjusted gross income for 2009? Adjusted gross income is on IRS Form 1040—line 37; 1040A—line 21; or 1040EZ—line 4.”</p>

<p>If your kiddos can do Calculus II they can fill out the FAFSA, and anyone filling it out for them (or hiring someone to do it for them) is doing their kid a complete disservice. And imho, NO you doing it for them is not much different from doing their research papers and their homework. The FAFSA is just another step in the college process (just like filling out an admission application or scholarship applications) and I view this an excellent opportunity for you to have a “teachable moment” with them. Taxes, filing status, deadlines, child support, AGI and tax exempt interest income… all the workings of life as an adult! You as the parent can sit next to them and interpret it with them. But THEY fill it out while you sit next to them or review and sign later with your pin. </p>

<p>Of course, I have known parents to fill out the kiddos admission applications as well, and even go to such extremes as SOME to force issues just to prove a point… <cough>. </cough></p>

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Steve, I would like to say your situation and information is very helpful.</p>

<p>Since apparently lots of people here are ED FAA experts, can any of you remember what the EFC was called BEFORE it was renamed the EFC? What about the FAFSA Express, anyone here remember that? Tell me, prove to me YOU all aren’t “posing”!! lol</p>

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The reason that they call it “professional judgment” and not “professional whimsy” and not “professional rubber stamp” is that they have decided to give the financial aid departments a great deal of discretion in deciding when to change things. </p>

<p>If a single low-income parent was receiving child support in an unexpectedly large amount – for example, suppose parent A earns $15,000 and receives $75,000 annually from the noncustodial parent – I believe that the financial aid department would be empowered to use professional judgment to make corrections to the FAFSA. In fact, if the FAFSA application was selected for verification, then the financial aid department would be required to obtain documentation of the true amount received as child support. </p>

<p>If parent A earns $15K and parent B pays $20K in child support, the college may think that’s not big deal – that still shows that parent A is a person of modest means. The point along the spectrum at which it becomes significant depends on — get this – the judgment of the financial aid professional. The law entrusts those college financial aid people to make that call, because it is assumed that they are smart enough to figure things out in a way consistent with the overall goals of the financial aid system. </p>

<p>Also, child support is a different category of income than interest income, because interest income usually reflects the existence of sufficient assets to generate that income. There are some exceptions, such as when interest is reported when someone cashes in a savings bond – but at least it puts the college on notice that further inquiry is warranted. </p>

<p>Also, if the interest or dividend income is tied to investment assets, it is likely to continue in the future. Child support tends to be reduced substantially just at the time the kid starts college, as the obligation to pay support usually ends when the kid turns 18. </p>

<p>So in my example above with the same numbers - a parent who earns $15K but has $20K in interest income - the parent with the interest appears to have more wealth than the parent who is relying on the ex to send a check. If that $20K turns out to reflect that the person as $400,000 in assets – the college would be more likely to exercise PJ to bring that income and asset under consideration than if the $20K turned out to be what was paid out when the parent cashed in $50K worth of savings bonds to make ends meet after being laid off from the job – because in that case it is non-recurring and the asset it represented is no longer there.</p>

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<p>No one is questioning that Steve “qualifies” for the auto 0. The point is that the qualification is NOT an “entitlement”. It’s just the first step in the process. ALL financial aid applications are subject to review by college financial aid departments; they are ALWAYS subject to the exercise of professional judgment. The college determination cannot be challenged. However, financial aid applicants can protect themselves by applying to multiple colleges. </p>

<p>As I explained above, a college would be unlikely to use PJ with a moderate amount of child support because it wouldn’t really constitute a “special circumstance”. To be a special circumstance it has to be something that makes the applicant atypical – a $10K in child support would be too common to fit that definition. </p>

<p>I honestly can’t see that any other private college considering need based aid would come to a different result in Steve’s case. Steve’s problem is that he has too much money to qualify for financial aid. The only way he even gets the possibility of aid is because his numbers happen to fit into an arbitrary category that triggers disregard of the majority of his income. But because of the way the system works, Steve’s numbers are always going to be reviewed, and I doubt that any college that sees the value of his investment portfolio is going to fail to exercise PJ to bring in the income and assets to the calculation. </p>

<p>The only way I see Steve’s son getting a Pell grant is via a college that has no intention of offering need-based grant aid to its applicants – for example, if Steve’s son applies to an out-of-state public that gives grant aid only to state residents – AND if Steve is lucky enough to avoid having his FAFSA selected for verification. The reason I say that is that if the college is not being asked to make a determination as to how to allocate its own funds, it has little incentive to scrutinize the numbers closely.</p>

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<p>Wait… what? First off- the homework is an INDIVIDUAL project. The FAFSA produces an expected FAMILY contribution. Therefore, if need be, a FAMILY should be involved in it, as the FAMILY is the one expected to pay. For homework, the STUDENT is expected to do it because it is the STUDENT who will receive the grade.</p>

<p>Now, I do think students should fill it out so they can learn about the things you mentioned (I have always filled out my FAFSA), but equating it to you doing their homework? What a really dumb thing to say. I’ve never seen you, but no wonder you were called a ■■■■■.</p>

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<p>Did I not JUST describe it as a FAMILY project?</p>

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<p>^ Yes, but as I said, homework= individual student. EFC = family= FAMILY participation. Which means one EXPECTS the family to contribute (EFC) and one does NOT (homework). So how is filling out FAFSA like doing homework? It makes NO sense.</p>