Students submitting the FAFSA (Free Application for Federal Student Aid) should be aware that the tax information used to determine aid has changed, effective Oct. 1, 2016.
Until this year, students have filed the FAFSA after Jan. 1 reflecting parent’s estimated annual income. Colleges estimated financial aid awards awaiting actual tax statements. Colleges often revised award packages after parents submitted actual tax returns in April. By that point it was too late in May or June for students to apply to more affordable colleges.
To expedite the federal financial needs analysis and avoid revising aid awards, colleges will be using income data that is two years old, referred to as the PPY (prior-prior year). Seniors graduating this spring will receive federal aid based on the 2015 prior year tax return, affecting students’ federal aid awards for their first two years of college.
Because of this revised system, families will be able to review financial awards in the fall of students’ senior year and adjust college choices accordingly. This change will be insignificant to families whose income is relatively level year to year.
Maria Badami is a college advisor with College Directions of CNY in Fayetteville. [email protected].
