<p>Hi, </p>
<p>I worked my butt off last summer and earned like 4k. The FAFSA SAR came in and i noticed my EFC went from 200 to like 1200, while my family's income is about the same. This bugs me because I pretty much used the 4k for my education(cost of living etc), and the increase seems pretty ridiculous to be honest. </p>
<p>What do you think? Are there any other factors that could have impacted my EFC?</p>
<p>No, $4000 student income should not have affected it unless you had other income for the year as well. A dependent student has some income protection (I think it is alittle over $5000 for the current FAFSA). Anything under that for the year will not affect the EFC. Anything over that will.</p>
<p>If your income was not over $5000, there must be something else that is different in the information you provided. Several factors can affect it - income increase, asset increase (parent and student), less earned from working, less taxes paid, a different tax return type filed, a change in reported family size etc etc. Go through every line of your SAR and compare to last years and see what you reported that was different from last year.</p>
<p>The earnings didn’t raise your EFC… You didn’t earn enough to raise your EFC.</p>
<p>However, if you had those earnings sitting in an acct when you filed FAFSA and you declared that savings, then that is what raised your EFC.</p>
<p>Another thing that may have raised your EFC…did your parents get a large tax return?</p>
<p>I forgot to mention that I had earned 1.5k(most of it are work study though) during winter semester, so i actually reported something like 5.5k in FAFSA for the 2010 year. Sigh this is disheartening.</p>
<p>I have another question. Will earnings from internships/co-ops affect my future aid/EFC? I plan on paying back some loans with those earnings but i’m not sure how that’s going to count against me…</p>
<p>work study earnings do NOT affect FA…maybe you didn’t list your work study earnings correctly.</p>
<p>work study earnings should not count against you, on the old FAFSA they were subtracted on the worksheets ABC section, with the newer smart FAFSA that skips questions, etc, I am not sure where that would show up, but somewhere it should ask you what amount of your AGI was financial aid</p>
<p>Earnings from work study, internships, and co-op are not counted in the EFC formula … BUT you must enter the amount you earned as earnings and AGI, then you have to put them in again in another area of the FAFSA (after the other untaxed income information). Students often do not pay attention to the questions on the FAFSA & miss that part.</p>
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<p>If by “return,” you mean “refund” – tax refunds are not income, and do not affect EFC.</p>
<p>swimcatsmom, kelsmom: Is there something in the FAFSA formula that is pegged to the CPI, or otherwise automatically raises EFC by a small percent every year? For example, if the exact same information is entered for one year, and then the next year, would you expect EFC to be exactly the same, or to have risen by a small amount?</p>
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I would expect the opposite. The formula is usually changed a little every year. Sometimes it is big changes like when the student assets that go to the EFC changed from 35% to 20% a few years back. Most years there are small changes such as the allowances going up a little - for instance the income protection allowance usually increase a little. So if all else is the same in the family finances, it is more likely the EFC will drop a little - not increase.</p>
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A smaller than usual tax bill may affect the EFC as taxes are an allowance against income in FAFSA.</p>
<p>But as I recall that’s tax liability, not tax refund, right?</p>
<p>If by “return,” you mean “refund”</p>
<p>Yes…refund. I was wondering if the parents had received a large amount of money from the IRS.</p>
<p>But, now it’s sounding like the student may not have done FAFSA correctly with his W/S earnings.</p>
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<p>You do know that a tax refund is not income, right?</p>
<p>Of course I do. :)</p>
<p>I’ve been a high tax payer for many years…I would know that a tax return is just getting my own money back because I withheld too much. </p>
<p>What I was trying to say…is that did the parents claim that they paid X in taxes when they filled out FAFSA…but really didn’t pay that much because of a large tax return that they received later… if so, then that can cause an increase of EFC. Kelsmom has explained that a few times on this forum.</p>
<p>You’ve never completed FAFSA, so you may not know that there are individual instructions for every question. For financial data having to do with income and taxes, FAFSA tells you specifically which line of the 1040/1040A/1040EZ to use – for this one, you’re directed to Total Tax (total liability), which as you say, may bear little relationship to tax paid. If the parents, or the student, input tax withheld rather than tax liability, they weren’t paying attention to the clear instructions. Not that that’s impossible, of course.</p>
<p>* If the parents, or the student, input tax withheld rather than tax liability, they weren’t paying attention to the clear instructions.*</p>
<p>Right!!!</p>
<p>That’s why Kelsmom says that that is a common mistake. People sometimes put tax withheld…so, they get a lower EFC…and then the EFC rises when the numbers get corrected. </p>
<p>I was just putting forth various possibilities as to why the EFC rose in this case.</p>
<p>Now, it sounds like the student may not have handled his work-study numbers entirely correctly…if so, that could also be the result of not carefully reading the instructions.</p>
<p>Kelsmom’s post…</p>
<p>*Earnings from work study, internships, and co-op are not counted in the EFC formula … BUT you must enter the amount you earned as earnings and AGI, then you have to put them in again in another area of the FAFSA (after the other untaxed income information). Students often do not pay attention to the questions on the FAFSA & miss that part. *</p>