<p>So I have a couple friends that are really smart and are applying to Ivy's. 3 of them live in mansions and drive like BMW/Mercedes SUV's. Their moms are in the US with them and don't work. Their whole cash flow depends on their dads, who are millionaires in Asia. They tell me that if they get into an Ivy, they'll get full tuition/board covered because technically their US income is $0. Is this true? If so, isn't there a way that colleges can detect this kind of stuff?</p>
<p>No, they would look at the income of both parents...so whatever income their dads are pulling in from Asia would be taken into account.
I'm not entirely sure I understand what your friends are saying...technically my family's US income is $0 since I'm a Canadian, and I'm definitely not going to an Ivy on full aid.</p>
<p>Edit: Actually, never mind, my example is irrelevant since your friends would have US bank accounts, so two completely different scenarios :P
You'd think there'd be some sort of safeguard against this sort of thing...</p>
<p>lol their father doesn't have to report his income from Asia. I know a few people like this--they have a lot of money but it's not in the bank, so it looks like they're really poor and unemployed. So now one girl gets full tuition to Harvard even though she doesn't need a penny.</p>
<p>This is called 'playing the system'. You find a tiny crack and you squeeze through it, instead of going through the way you should - through the door.</p>
<p>Why don't you do this? If they get in, NARC on them because they'll be getting something undeserved. Don't take into account the Ivy deep pockets. They aren't deserving and should benefit off the back of others who are.</p>
<p>SQUEAL ON 'EM!</p>
<p>the school might wonder how they put together their EC list or managed to get great numbers with 0$ of income. the college would also see their address or zip code(some are pricier than others.) I would tell on them, it's not really fair, those who are actually disadvantaged and apply with 20k income or so can't compete with these millionaires posing as the disadvantaged.</p>
<p>No problem. Even if they do get into an Ivy with that kind of attitude they will end up sweeping streets anyway.</p>
<p>There are a few things to consider: 1) to receive aide you must be a US citizen, 2) do they own their house, if so, that is asset. It is much easier to hide asset outside of the US, but with computers it is not as easy as it used to be. At my bank, we have systems that's dedicated to money laundering, which traces money movement. As a US citizen or PR you must file tax return. Any deposit made to your bank acct greater than $10,000 will be reported to IRS (I presume for your friends to pay for mortage, cars, the money must come from some where). All that being said, it is still possible to hide your income/asset. Of course, there is also a good chance of getting caught.</p>
<p>Not sure if this is the case with the OP, but this could be the loophole: When Americans are living as ex-patriots in another country and they are not in the USA for more than 30 days, they do not have to claim income earned abroad with the IRS. If the wife is not working, she would not have any income to claim and the family income would clearly be quite low. Depending on the country in question, this man may not be paying taxes anywhere. This is legal, but a case could certainly be made as to whether it is ethical. Even if the school was made aware of the situation, I'm not sure anything would change because it isn't illegal. My sister's husband was with an international firm for a few years and they didn't have to pay taxes for some of that time. Guess the rationale is that these people aren't benefitting from the taxes paid.</p>
<p>Actually US citizens are legally required to file US tax returns even if they are living abroad. There is an exclusion for a certain amount of the overseas earnings but they still have to be reported.</p>
<p>My husband was overseas for 12 years and did have to complete US income taxes and report all his income.</p>
<p>These ppl make me so angry!! My friend, whose family is way richer than we are and stowed all their cash in the Asian housing industry, has filled out the FAFSA and somehow ended up with a lower EFC than me. >.< !!!</p>
<p>This relates to what swimcatsmom and Panhandlelegal have said:</p>
<p>I know someone in a similar situation as the OP. His dad lives in China and owns a controlling stake in a Chinese company worth hundreds of millions that is planning on going public. However, his father's income as the CEO of that company is less than 70k a year and therefore he is exempt from paying taxes in the United States. My friend lives very modestly and you would never guess his parents were multi-millionaires until you visit their houses in China...</p>
<p>My question is, how will colleges know since the value of the business is not reported on their tax returns? Also, would colleges expel/rescind his acceptance if they found out? (He is applying for financial aid at HYPS only).</p>
<p>haha that's kind of clever. wrong, but clever.</p>
<p>sup -it happens all the time and there isn't much we could do about it. There are a lot of people in the cash business (restaurant, dry cleaning) where a lot of income is not reported. They put their money offshore or keep it as cash at home.</p>
<p>I suspect the reason your friend lives very modestly is because his father can't afford to transfer too much money into this country, or it would be traced. Our computer systems have become a lot more sophisticated to follow money movement, but they are not perfect yet.</p>
<p>My husband makes most of his income from oversea companies (he is an importer). Many of those countries have agreements with US to report cross border income now. It is getting harder and harder to hide ones income, if that's your objective.</p>
<p>Yes, if HYPS (or any school) found out false filing of financial aide application, they would rescind acceptance.</p>
<p>I don't think they would rescind acceptance. Often times it's the parents filing these documents not the students. The students could even be oblivious. I'm sure they would not provide any FA but wouldn't punish the students for their parents unethical character.</p>
<p>FFB - you are probably right, it makes sense.</p>
<p>If SUPs friend is doing a FAFSA then the value of the % ownership in that company should be reported as an asset (stock) or as value of business owned. If they have less than 100 employees, then they can say $0 legally; more than 100 employees they better state the value or commit fraud.</p>
<p>If the mom & dad are legally divorced or separated, then legally they do not need to report his income.</p>
<p>Or, he could have so many loss carry forwards that his effective AGI is a low number.</p>
<p>You never know the real story, maybe life is not as good as it looks for them, maybe they reported more than the student is saying. Chances are SUPs friend did not do the FAFSA herself/himself and does not know how it was done and does not know what the families holdings are. Many life is tough for mom & dad and they are living modestly and have a real struggle back home, but have not told the kid.</p>
<p>It seems "a lotta" people believe what the worst of others or believe whatever seems the least fair. Not that there aren't people out there committing fraud sometimes, but things are rarely as they appear and it may not be so fraudulent or unfair, it may be using the rules to their advantage. Hey, if mom & dad are living in different coountries and he is rarely here, maybe they are only filing as her being the custodial parent??</p>
<p>Just another take on it.</p>