FAFSA Form & Financial Aid Form Blog

Every year, families look for additional ways to pay for college without impacting the EFC, or the Expected Family Contribution. One way is gifting - giving money to a student or parent to pay for education, but that shows up as an asset in the FAFSA, which is not a good thing.

However, there’s a loophole: if a grandparent or other non-parent relative makes a payment directly to the school, the money is never visible as far as the financial aid process goes, and that’s the best way to go - funnel money through the grandparents or uncles or whoever is not an immediate family member, and avoid the gifting tax and gift limits.