Ask Terry Questions FAFSA, financial aid and 529s

FAFSA, financial aid and 529s

By Terry Savage on December 22, 2015 | College Savings / Student Loans

When I filed FAFSA it did not ask for both divorced parents income. I was just in court last week because my ex is trying to force me to file for our 2 kids because I have a low income. He has a very high income, has always claimed both kids on his taxes AND they have a 529. But both our kids received financial aid loans. When I realized how it was hurting kids who actually need aid to go to college I said wasn’t going to file again. So now my ex and kids are furious with me. I wish there was a place for both incomes so I wouldn’t even be in this position right before Christmas. Please let me know if there is something I missed on the form so I can show the kids. Thank you.

Terry Says:  There is a rule that covers this, so divorced parents don’t argue with each other over this issue.  And it is not necessarily the parent with legal custody of the child who must file.  Here’s the rule explaining who must file when parents are divorced and not living together:

The parent that you lived with most during the last 12 months. If you did not live with one parent more than the other, provide information about the parent who provided more financial support during the last 12 months, or during the most recent year that you actually received support from a parent.

Here is a link to the government’s website, FAFSA.ed.gov that should cover the issue.   Since this is a Federal process, I’m not sure that divorce court judge could contravene the rules.

And may I step outside the box here and offer some unsolicited advice?  It is not unpatriotic to adjust your income taxes — legally — to pay the least amount of tax.  This is a similar situation.  Many people take steps to adjust their income — within the law — to qualify for a Federal student loan.  So if you’re standing on principle here, you could be on shaky ground if you are the parent who spent most time with the kids this past year in your home.  And, in the process,  you’re creating a lot of long-lasting ill will.

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