Tax Information Needed for the FAFSA
Every year millions of students in the United States complete the Free Application for Federal Student Aid (FAFSA). A student uses his and often his parents' tax information to complete the FAFSA so that the Department of Education can determine the student's expected family contribution (EFC). The EFC will then be used to determine what types of grants and loans the student is eligible for.
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Tax Forms Needed
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A student applying for the upcoming year will need tax information for the previous year. You will need your Social Security number, or tax identification number, and your W-2 forms, unless your income is reported differently, such as on a 1099 form. A student will also need to refer to his IRS form 1040, 1040 A or 1040 EZ.
Parents' Tax Information
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If you are considered a dependent, you need to gather your parents' tax information as well. Generally, the Department of Education considers you to be a dependent for the purposes of financial aid if you are 23 years of age or younger, are working on an undergraduate degree and are not married.
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Independent Students
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To be considered an independent student and have only your tax information used to calculate your financial aid, you must be one of the following: 23 years of age, married, working on a graduate degree program, serving on active duty in the armed forces, a veteran, a parent who supports his children, an emancipated minor or if your parents are deceased or you were a ward of the court after the age of 13.
Unusual Circumstances
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Even though a student may report high earnings on his FAFSA, unusual circumstances can be a factor affecting the EFC. Paying tuition at an elementary school or secondary school, significant changes in income or assets, recent unemployment of a spouse or a parent or medical expenses that are not covered by insurance are considered to be "unusual."
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References
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