<p>I tried this last year to no avail. My package was not prohibitively bad then, though, so I left it alone and shouldered the bad part.</p>
<p>My sophomore year aid is terrible. I cannot afford to do what they're suggesting I do. My dad's income did increase this year, but it didn't double like the EFC did. Considering the EFC was unbearably large in the first place (I ended up living off campus to save the difference, and am currently running at ~$5000 less per year than the school says I should), the increase makes it impossible for me to continue at school.</p>
<p>The main problem with the EFC configuration and the UC -- the reason they told me my package could not be reconfigured -- is that they go off of one tax number on the 1040x form and don't consider self-employment taxes (reported on another line). It looks like we don't have to pay much in taxes, but in reality a full fifth of my dad's income (the only income in the house) goes in one lump sum to the IRS in February. They told us that the reason they ignore this number is that "usually" the deductions negate the tax entirely, and so it is a non-issue. The problem is that this isn't true: my father is self-employed, but he doesn't have a business. He is an aviation consultant.</p>
<p>Does anyone have any suggestions for how I should approach the school this year? I really cannot attend if the package isn't fixed, but given that they are formula driven (or at least were last year -- can't imagine why they wouldn't be this year), how can I persuade them that it's necessary for me to keep going there?</p>
<p>(In related news, I am applying to transfer to a private college that I'm hoping will be more considerate with aid; I probably won't get in. If UCSC can't fix my package, I have few qualms with putting my education off for a while and exploring other options like CCC for a year, or just taking a year to work, etc. Obviously I'd prefer not to do this, but...)</p>
<p>I've been in contact with UCSC for my brother over similar issues. We're requesting re-evaluation of our aid files at the UCs due to extenuating circumstances (medical debt not reflected by FAFSA.) The fin aid rep at SC told us to send in a letter explaining why our EFC should be re-assessed, and then to call them in about a week to follow up. He said he expects our aid officer to take these circumstances into consideration, and probably request additional documentation of expenses. Maybe you should do the same thing and send in documentation of your father's self-employment and taxes.</p>
<p>I have, but I'm hoping I can make an appointment to sit down in an office with them and bring the documents with me. I get the feeling they went 'eh, unnecessary forms' and tossed them without considering anything, giving me a rote answer, etc.</p>
<p>At least there's some hope! Thanks, Almost_There.</p>
<p>Many posts here start to sound like the threads on UC appeals which say they have no new info but they will try anyway. Every school has a way they look at the self employed, if it doesn't work for you they're unlikely to change it. Some businesses have more deductions than others. They know that. Unfortunately, I don't think they will think a fifth of your dad's income to the IRS is more than they thought.</p>
<p>I'd be shocked if a private college would help, especially if your family owns a home in CA. UCs do not count the home when assessing EFC, but almost all private colleges will. If your family owns a home that has gone up in value, as most in CA have, you will be shocked at your EFC when done with the profile.</p>
<p>The good news is that UCs don't cost $45K. With double shifts this summer you can probably clear $4K. Work another 10 hours a week during the school year for a few thousand more. You can take some extra loans and maybe your parents will. If need be, take 1 term off. But this doesn't need to derail college for you.</p>
<p>Afifth of 50,000 in CA should mean something, but I get the drift, zagat. That's the sense I've had most of the time, anyway.</p>
<p>My family doesn't own a home. We pay rent. </p>
<p>The initial cost of the UC may be lower, but there are a lot of things the PROFILE helps illustrate in my financial profile that the FAFSA completely ignores that paints a better picture of what our financial situation is. </p>
<p>For family reasons, it'd be hard for me to work much this summer, but I will of course be doing what I can. </p>
<p>Undecided, you're right, if your family rents and makes $50K, a private college may well do better. The thing to focus on is privates that meet 100% of need and have large endowments, so can be generous with aid. The UCs make low income kids borrow much more than many privates do, making the packages better just on that front. Good privates are much more likely to work with you.</p>
<p>The "large endowments" and "100% of need" parts are the most important. UCSC has neither (or if they do have the latter, they're really lousy at meeting it since they've gapped me twice).</p>
<p>I am surprised -- I did a calculation, and I am expected to take out roughly $35,000 in loans for my UC education. I heard that that's a little on the high side (though obviously it could be much worse!). Even if it isn't, as I'm planning to go into a rather low paying field (publishing), I'm very, very conscious about the amount of debt I'll have when I leave school.</p>
<p>I applied to UChicago, whose FA I've heard mixed things about. I came into the transfer thing a little late in the year (I didn't actually decide to transfer until mid-February), so if that doesn't pan out (which I'm assuming it won't), I'll be reapplying in the fall to a broader, more thougthful list.</p>
<p>Self-employment taxes are not ehlpful at all, as you are paying both halves of FICA. On the worksheets, I think it is C, your federal income taxes paid are subtracted from your AGI helping the overall income number for fina aid purposes, but that does not happen for self-emplotyed people. I did follow up on this and you can find where the FAFSA says not to include the self-employment taxes.</p>
<p>You can review the FAFSA formula to see if you can adjust your circumstances at all:</p>
<p>Yes, the fact that we pay self employment taxes rather than 'regular' taxes is what's giving us problems. It makes my dad look like he's paying a really small amount in taxes (~$2k?), when the bulk of the taxes paid (~$10k) are reflected under that SE number which doesn't show up anywhere on the FAFSA.</p>
<p>I will review the link with my dad. Thanks, somemom!</p>
<p>Take another look at the formula and the tax return-- I think half of the SE taxes are deducted from income to get the AGI (see line 30). So they should be in part reflected in the FAFSA calcs since FAFSA uses AGI as a starting point.</p>
<p>Self employed folks can also deduct their health insurance premiums (for the family, I believe) which will get the AGI down considerably. Also-- this might be a good time for your dad to invest in the business to increase expenses during your first couple college years, so as to keep his net income relatively modest. Busineess owners sometimes don't fully consider all the expenses they actually have that can be deducted. Office in home, business use of the car, and on and on.</p>
<p>Also-- if you have savings of your own, they can increase your EFC dramatically. So better to let your dad keep the savings going forward, if possible, and to pre-pay any major personal expenses you may have from your own savings before you complete (or update) FAFSA. Good luck!</p>
<p>sblake:
You are right, there is a reduction for the 1/2 SE taxes. I guess that makes the tax treatment equal, but nevertheless painful when you actually write the checks vs having smaller increments taken out each pay period.</p>
<p>If every one in the US received all their pay and then had to pay taxes we might have another tea party in Boston :p</p>
<p>1) I didn't know half of SE taxes were deducted. If that's true, we made a huge mistake on the forms... definitely need to look at that!</p>
<p>2) We don't have health insurance.</p>
<p>3) He can't invest in business expenses too much because the income goes toward other things. I have no idea what, but my thought is that it goes toward some debts we have, or just the living costs of being in CA. He has, however, and it has saved us some money in taxes. But the problem is that he's not a business, he's a self-employed consultant whose expenses go through the company he works in proxy to.</p>
<p>4) I don't have any savings (nor do they, actually). </p>
<p>5) Receiving your pay in uneven intervals during the year (he sometimes works 2 months straight, and then not at all for a few months) and then having to pay 1/5 of it in one lump sum is VERY painful. :P</p>