Preparing for college is an exciting time for both parents and children in Ohio. Opening that first acceptance letter, touring campuses and shopping for dorm room extras are only a few of those fun experiences. Of course, there are few things that can seem a little bit daunting. Saying goodbye is one of these things, and filing the Free Application for Federal Student Aid is often a frustrating event.
For parents that are divorced, there are a few extra details that they might want to know when filling out the FAFSA form. In many cases, having two parents that live apart can be a big benefit. How? For one, only one income may be considered in determination of financial aid.
When applying for federal financial aid, the 12 months prior to signing the document matter — not necessarily the calendar year. When it comes to the FAFSA, the income declared should be that of the parent with which the child lived with for a longer period of time. Whether or not a custodial parent declared the child as a dependent on an income tax return is irrelevant.
How can this benefit a child with divorced parents? Take the example of a child with one parent that earns $200,000 and one that earns $50,000. If the child lives with the parent who makes $50,000, that is the income their financial aid will be based on. If the child spends exactly the same time in each household, then the parent that spent the most on the child would complete the FAFSA.
It is important to note here that a parent who remarries is no longer considered a “single-income” parent. In this case, if the child resides with the now married mom or dad, then the stepparent’s income is combined with that of the parent.
Source: CBS, “How does divorce affect college financial aid?” Lynn O’Shaughnessy, Sept. 27, 2013