<p>^^makes sense swimcatsmom, I didn’t go back and look at the info for dependents other than your kids and just made an ass-umption.</p>
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The tax line numbers the OP referred to in earlier posts are the lines for pensions and annuities. So maybe they have some sort of annuity fund. (I earlier thought they were IRA distributions but they are line 15, that’s what comes of answering CC posts in the wee hours of the morning)</p>
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LOL. I like that.</p>
<p>I get a minimum distribution from an annuity I inherited from my mom. I get a 1099 EVERY year with the amount of my small minimum distribution of $900. Seems like a distribution in the 10’s of thousands of dollars would require the same. These companies are required to report their distributions.</p>
<p>crazybandit: I really think you need some assistance with all of this. You really need to talk with whoever did your parents’ taxes and have them explain why there’s such a big amount of pension/retirement money.</p>
<p>The bottom line of this situation is that the money that’s reported on your parents’ taxes as pension/annuity/retirement money is what is causing the high EFC. If the number is legitimate, it has to be reported on the FAFSA and then you are stuck with the higher EFC, plain and simple. I know that would really suck but that’s how the FAFSA works.</p>
<p>Oh I wasn’t disputing that they would have to have a 1099. They would. Just saying that the money might be from an annuity rather than a pension. Or a combo if the 2. No way we can know. The OPs parents must know where the money is from surely, whether they speak English or not. </p>
<p>I wonder if there is a cultural and or generational element at play here. American parents and the current generation of parents of college students seem, on the whole, very open with their offspring about their financial business. I never had a clue what my parents earned. Even now when I try and help my 86 year old Mum (in England) find out what benefits she might be eligible for because of her age and low income I find I am working in the dark because she is very private about her financial info. I am somewhat more open with my kids, but not in a “here is every detail” way. But I fill out the parent part of FAFSA and have no problem giving my daughter my tax returns to take to school when they requested them for verification (no idea if she was interested enough to peek). Maybe the OP’s parents are of a culture and generation where they are not comfortable sharing too much info. Makes it a little tough if the OP is the one trying to do FAFSA.</p>
<p>First of all, I don’t need any more help on where the pension money comes from or why it’s so high. I understand I can only get the answer from my parents.</p>
<p>Here is new information:</p>
<p>(1) I just checked the tax form and my grandma isn’t listed as a dependent. Me and my brother are, and my father filled it out jointly with my mother. I put down 5 as the number of members in my household. Should it be 4 then?</p>
<p>(2) I checked the 2008 tax returns, and the AGI was $31,740. The income from work was $31,740 (my dad works in a restaurant so I assume income isn’t consistent), meaning there were no pensions or otherwise. The following question may or may not be able to be answered, but I want to ask just incase it is possible. Why, this year, did we receive pension income if my dad hasn’t retired, and my grandparent hasn’t done anything different from last year?</p>
<p>(3) My brother goes to college. Could I just use his FAFSA (they are filled out every school year, right?) concerning our parents’ financial information?</p>
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<p>I see. So why does the figure of nontaxable pension income hold so much weight when it is not included in the AGI? Can someone explain what nontaxable pension income is IN TERMS OF how it affects our ability to pay for college? Is it free money? If so, what are the possible reasons that my parents can barely pay for rent then?</p>
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<p>My grandma hasn’t worked for a long time. Can someone explain where pension incomes can come from if my parents haven’t retired? Is it given to those anticipating retirement?</p>
<p>The hunch I am getting is that, in general, if a student’s parents were retired, the EFC would be a lot higher than if his or her parents were working. Is this true?</p>
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Only your parents can tell you where the pension income is from. Ask them. They must know. No one magically gets that much income without knowing where it came from.</p>
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Income is income. Whatever the source. Even if it was not taxable it is income. If you have $25,000 AGI and $25,000 untaxed income that is $50,000 income as far as the EFC formula is concerned.</p>
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How can we know that? Ask your parents.</p>
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Your grandma’s income is not relevant to FAFSA.</p>
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Not really. Most retired people have a lower income so that makes the EFC lower. It is income that counts.</p>
<p>But where the income is from can make a difference. $50,000 unearned income will make the EFC higher than $50,000 income earned from work because of the allowances for income earned from work. $50,000 untaxed income will cause a higher EFC that $50,000 taxed income because the taxes are an allowance that reduces income used in the EFC formula.</p>
<p>OK, if the government is giving my family retirement income, isn’t that income used for retirement purposes only? Let’s say all the pension income is used to pay for college. How will they have money for retirement, such as paying the bills with no job (even though they are still working, which still makes no sense to me)?</p>
<p>Here are some questions I posted before that you looked past:</p>
<p><a href=“1”>quote</a> I just checked the tax form and my grandma isn’t listed as a dependent. Me and my brother are, and my father filled it out jointly with my mother. I put down 5 as the number of members in my household. Should it be 4 then?</p>
<p>(2) I checked the 2008 tax returns, and the AGI was $31,740. The income from work was $31,740 (my dad works in a restaurant so I assume income isn’t consistent), meaning there were no pensions or otherwise. The following question may or may not be able to be answered, but I want to ask just incase it is possible. Why, this year, did we receive pension income if my dad hasn’t retired, and my grandparent hasn’t done anything different from last year?</p>
<p>(3) My brother goes to college. Could I just use his FAFSA (they are filled out every school year, right?) concerning our parents’ financial information?
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<p>How did your brother fill out his FAFSA this year? Where did he get parent information? There is one parent portion, then that carries over to you and carries over to your brother unless your brother is older and filing independently (age 24 up). The total EFC should be split between you and your brother…and yes in theory the parent portion would be the same for you and your brother.</p>
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<p>Is it possible that your parents withdrew an amount of money FROM their retirement accounts? This possibly could show as an income pension…maybe.</p>
<p>OR is it possible that this amount is a mistake on their tax return. Check their 1099 forms…and find out WHERE that amount came from…that should help.</p>
<p>*OK, if the government is giving my family retirement income, isn’t that income used for retirement purposes only? *</p>
<p>Did one of your parents retire from a previous job…perhaps from another country? Did your parent withdraw a lump sum from a retirement acct? </p>
<p>Either way, the answer to your question is “no.” If the gov’t gives someone a retirement pension, that money isn’t protected in any way. It isn’t “just for retirement purposes only.” It’s for whatever expenses the family has.</p>