6 common mistakes to avoid when filling out your federal financial assistance form
Completing the Free Student Aid Application – better known as FAFSA – can be long and arduous, but fetch thousands of dollars in subsidized student loans. Due to the time it usually takes to complete, there are some common mistakes that the Federal Aid Office has seen often enough to be brought to the attention of students and parents.
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Here are the six most common mistakes you want to avoid to make sure you receive as much financial assistance as possible:
The Federal Student Aid Office lists this as their # 1 mistake for good reason. Many often avoid filing all together even though they qualify. They claim that some of the reasons they usually get for people not wanting to file are fear that it will be too difficult or the belief that they will not qualify. They insist that is not the case and that there is no income limit on federal student aid.
The FAFSA form is not only for Pell Grants, but also for applying for Federal Work Study Funds, Federal Student Loans, and even scholarships and grants offered by your state, school, or private organization.
Do not differentiate your information from that of your parents
The financial information of the student and his parents must be included in the FAFSA application – separately. The government must not only be able to assess the financial situation of the entire household, but also of each person individually. If the child has more income than the parent, for example, this could affect the amount of assistance granted.
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Do not disclose accurate financial information
You do not need to disclose each of your financial assets in the FAFSA form, but you do need to disclose the real estate holdings, their value, and the rents you receive – although the value of the house you are currently living in does not have no need to be included. Your 401k contributions and retirement account are also among the assets that don’t need to be reported. A specific overview of the items that do not need to be included can be found here.
Use of parent’s FSA identifier
Parent AND student need their own separate FSA credentials if the student is a dependent claimed on their parents’ taxes and you and your parents both want to sign the FAFSA form online. It is strongly recommended that you do not share FSA credentials with each other as this may cause delays or problems with your financial aid. Since financial aid is on a first come, first served basis, it could cost you thousands of dollars in aid – or aid in total.
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Do not use IRS recovery tool
Filling out financial information is the most difficult part of the FAFSA process, but through a direct link with the IRS, eligible students and parents can automatically transfer all of their 2019 tax information into the FAFSA 2021-2022 form to the IRS Direct help. This eliminates the possibility of errors and the Federal Aid Office says it is the fastest and most accurate way to enter your tax return information into the FAFSA form.
Don’t think of yourself as a dependent student
The Federal Student Aid Office states that even if you support yourself, pay your own bills, and report your own taxes, you can still be considered a dependent student for federal student aid purposes. Dependency guidelines for financial aid are determined by Congress and are different from the IRS dependency guidelines. They point out that if you are considered a dependent student and fail to provide parent information, your FAFSA form may not be processed and / or you may be eligible for loans that you may need to repay.
With the FAFSA deadline fast approaching, don’t delay getting your documents together and start filling out the financial aid form.
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Last updated: September 15, 2021
This article originally appeared on GOBankingRates.com: 6 Common Mistakes To Avoid When Filling Out Your Federal Financial Aid Form