FAFSA Form & Financial Aid Form Blog

Author: General Manager, FSA Application, School Eligibility and Delivery Services Summary: 2005-2006 Free Application for Federal Student Aid (FAFSA) Processing Deadlines The U.S. Department of Education would like to remind financial aid administrators of the approaching application and correction deadlines for the 2005-2006 application processing system, as published in the Federal Register on June 7, 2005 (70 FR 33134). This notice is available on the IFAP Web site at http://www.ifap.ed.gov/fregisters/FR06072005.html. A correction was published on June 15, 2005 (70 FR 34818) and is available at http://www.ifap.ed.gov/fregisters/FR06152005.html.

The deadlines are as follows:

** 2005-2006 FAFSAs must be received and accepted by the Central Processing System (CPS) before 12:00 midnight Central Time (CT), June 30, 2006. **

** Corrections to 2005-2006 processed applications, including signature pages, must be received and accepted by the CPS before 12:00 midnight CT, September 15, 2006. **

These deadlines apply to both paper and electronic submissions. The Department will make no exceptions to these deadlines, including cases in which schools have awarded Federal Pell Grants (Pell Grants) to students who do not have Pell-eligible Institutional Student Information Records (ISIRs).

The Common Origination and Disbursement (COD) System will not accept a Pell Grant disbursement record for a student who does not have a Pell-eligible ISIR. Students and schools should submit 2005-2006 data to the CPS far enough in advance of the deadlines to allow time to make corrections to the application data, if necessary.

If you have any questions about the deadlines, contact CPS/SAIG Technical Support at 800/330-5947 (TDD/TTY 800/511-5806) or by e-mail at CPSSAIG@ed.gov.

Thank you for your cooperation and assistance.

… for falsifying a FAFSA. I had thought that wasn’t the case, but in the fine print on the DOE web site, the penalties for FAFSA falsification are pretty stiff. If you knowingly and intentionally submit false or fraudulent data on your FAFSA, you stand a $2,000 fine, jail time, or both…

So don’t do it. Instead, shift your money around legally!

Loophole Could Increase Some Students’ Eligibility for Financial Aid

By KARIN FISCHER

Under a little-noticed loophole in a new federal law, money set aside in college-savings plans will not be counted in determining a dependent student’s eligibility for need-based financial aid if the account is in the student’s name, according to guidance released last week by the U.S. Department of Education.

The loophole — created by Congress in February when it passed deficit-reduction legislation — is reflected in a proposed revision of the Free Application for Federal Student Aid, or Fafsa, which the U.S. Department of Education published last Tuesday in the Federal Register.

The Fafsa is the standard application form that the federal government, state governments, and most colleges use to determine a student’s eligibility for financial aid.

In the draft revision of the Fafsa, instructions direct applicants to report the value of assets in college-savings plans and other education accounts owned by their parents. But, the instructions state, “Do not report the value of these accounts if the student is the owner.”

It is unclear how many families the change could affect, said Joseph F. Hurley, an accountant who tracks the plans for his Web site, Savingforcollege.com. While New York State does allow parents to act as custodian of a dependent student’s plan, many states do not permit accounts to be opened in a minor’s name.

There is also some confusion about whether Congress meant to create the potential loophole or whether it arose from a legislative drafting error. “I’m not sure how many people who are rushing out to open plans because there is some skepticism that’s what was intended,” Mr. Hurley said. Still, he added, “on an individual basis, this certainly could be a substantial benefit.”

Under previous law, money placed in college-savings plans, even under a student’s name, could shrink a student’s financial-aid award, although the size of the reduction depended on factors such as family income and the cost of attending a particular institution.

The Education Department is seeking comment on the revised Fafsa through August 7.

Investors have opened about 8.6-million college-savings accounts, with a total value of more than $89.46-billion, according to the College Savings Plan Network, the association that represents state-run college-savings plans. All 50 states and Washington, D.C., now offer the plans.

June 7, 2006

Author: Jennifer Douglas, General Manager, Student Aid Awareness and Applicant Products and Services

Summary: First draft of the 2007-2008 FAFSA available for comment

The first draft of the 2007-2008 Free Application for Federal Student Aid (FAFSA) is available for comment. A Federal Register Notice opening the 60-day public comment period was published June 6, 2006. Comments on the draft FAFSA may be sent by e-mail to FAFSAComments@ed.gov.

We are proposing the following changes to FAFSA questions in order to be compliant with the Higher Education Reconciliation Act (HERA):

1) We added new questions for a student (and spouse) or a student and his/her parents asking about benefits they received from any of five means-tested federal benefit programs.
2) We added a new dependency question to allow a member of the U.S. Armed Forces serving on active duty for purposes other than training to be treated as an independent student for financial aid purposes.
3) We revised the question about drug-related offenses to reflect changes made under HERA.
4) We deleted the following questions for space reasons: questions 27 and 28 regarding the student’s interest in student loans or work-study and questions 94-97 representing a fifth and sixth college choice. (Question numbers refer to the 2006-2007 FAFSA)

http://www.ifap.ed.gov/eannouncements/attachments/Draft0708FAFSA.pdf