Federal Financial Aid Form available for 2018-2019 school year

October 3, 2017|Donna Schultz

Planning for college is an exciting time, yet for many families the cost of attending can be overwhelming. Looking to qualify for financial aid? Take note of the upcoming recommended filing due date for the application process.

To qualify for federal financial aid, students need to complete the Free Application for Federal Student Aid (FAFSA). Historically, the recommended due date for filing the FAFSA was March 1 each year, utilizing estimated individual income tax information from the prior year. This timing was challenging since many taxpayers do not have their income tax returns filed by that date.

Former President Obama had signed an executive order changing the FAFSA rules. Beginning with the 2017-2018 school year, the FAFSA is based on the “prior-prior year” (PPY) income information. The revised recommended filing due date was shifted back to October.

Benefits of the FAFSA rule change

The timing allows applicants to use the IRS Data Retrieval Tool (DRT) to automatically pull income tax data directly from the IRS into the FAFSA, including information regarding adjusted gross income and taxes paid as required on the FAFSA form. Beginning October 1, you can start using the DRT. The IRS had temporarily pulled the tool as a result of identity theft concerns, but it has been reinstated and is available for the 2018-2019 FAFSA form. By making the process easier, more students are expected to complete the FAFSA process to obtain the aid for which they’re eligible

The new timing of the FAFSA filing is also more in line with the college application process. By filing the FAFSA by the recommended October due date, applicants should receive their Student Aid Report (SAR) by November, before college decisions need to be made. The SAR contains the Expected Family Contribution (EFC) which is calculated based on the family’s assets and income tax return information. The applicant’s schools will use this information to determine the student’s eligibility for federal and other types of financial aid.

Financial aid planning tip

The 2018-2019 FAFSA is currently available. Some states and schools have limited funds, so it is advisable to complete the FAFSA now.

Please contact your account director or call Donna Schultz at 800-236-2248 if we can be of assistance.

Donna Schultz, CFP®, CVA, is a senior manager and valuation analyst. A leader of our valuation team, Donna has many years of business valuation experience for purposes of transition planning, buy-sell agreements, and management planning in a wide variety of industries.