My question is do I report my rental property on FAFSA and if so:
- Do I report income from it?
- Do I report it equity?
- Both?
Yes you report it - why do you think you would not need to?
The income from it is already in your AGI. The depreciation will likely get added back to AGI.
Report the fair market value less the debt, for the asset value.
Madison85 is correct in that you report the rental property’s value as its NET WORTH = its market value minus any debt owed on it.
But don’t stop there: You shouldn’t start the valuation process at its market value. Instead, use its “quick-sale” value as the starting point for determining its net worth. The IRS defines a quick-sale value is 80% of the property’s fair market value. Thus, if the market value is $100,000 and the property’s outstanding debt/mortgage is $30,000, its quick-sale value is $50,000.
Thank you very much this is helpful information. My daughter will be Senior next year and I am trying to get educated on how to fill the FAFSA.
Quick sale value - excellent point, @Minnesotadadof3 !
http://www.oregonlive.com/finance/index.ssf/2012/02/fear_the_fafsa_here_are_five_m.html
[quote]
Value real estate correctly. Parents who own a rental or a second home shouldn’t enter its market value. Instead, enter its net worth. That’s the value minus any debt owed on it.
What’s more, you needn’t start by valuing the property at its market value. Rather use its quick-sale value, Wagar says. That’s 80 percent of the property’s fair market value, the Internal Revenue Service says, or what it could sell for quickly.
We were never asked for that information, but it may depend on whether you are actually qualifying for money or not whether you are asked to get into such specifics.
You report the equity AND the income…both
@sylvan8798 did you submit CSS Profile to ask for financial aid? or just FAFSA?
No, I did not submit CSS Profile, my daughter is a Junior this year. However, is that something I should do? in addition to FAFSA>?
You don’t need to be asked for the rental property depreciation because it is on Schedule E and Form 4562 (and the tax return transcript).
^We weren’t asked for those either.
No CSS Profile schools.
Interesting.