“What tax forms do you need for FAFSA?” you may ask. The government crucially looks into a lot of information about all applicants of FAFSA (or the Free Application for Federal Student Aid). And this includes asking for an applicant’s (or their parents’) tax income details. Because of this, proper compliance with certain tax declaration rules is an assurance of getting admitted to the program. Here is some information you need to know about the FAFSA tax return requirements.
FAFSA Tax Return Requirements: What You Need to Know
What is FAFSA?
First, what is this FAFSA all about? It is a program by the US Department of Education (ED) in which one can apply for financial help to pay for college or career school. This financial support covers school tuition and fees, and supplies needed for studying such as books. ED extends its assistance to cover other school-related expenditures such as boarding and transportation. The FAFSA program provides more than $120 billion-worth of assistance annually, either through grants or loans.
Is Tax Declaration Needed?
The government needs a lot of information from applicants – including income tax payments. Income tax declaration (either by the student-applicant or by the parents supporting the applicant) is a crucial requirement for the awarding of financial aid packages. This is where the government base the type and amount of financial aid provided to applicants.
What Tax Declaration Is Required?
In the questionnaire provided by ED, applicants are asked if they have filed — or will be filing — one of the following tax return forms:
Form 1040 is the generic income tax return form. One needs to fill-out Form 1040A or Form 1040EZ if he:
- earns less than $100,000 per year
- does not itemize possible tax deductions
What If There’s No 1040 Declaration?
There are instances wherein a student-applicant (or the parents supporting the applicant) is not required to file a tax return form. If this is the case, then the applicant should disclose this in the FAFSA form.
FAFSA application is also open for individuals in territories outside USA — Puerto Rico, Guam, American Samoa, the U.S. Virgin Islands, the Marshall Islands, the Federated States of Micronesia, and Palau. Since they are not required to fill out 1040 forms, the corresponding tax return forms in their areas should be declared.
Complying with these FAFSA tax return requirements is just one of the steps to apply for the program. Check out this video from The FAFSA Guru to know other application requirements, as well as secrets for getting the most financial aid possible:
The FAFSA tax return requirements are important documents in determining the financial assistance an applicant will be getting. More than just complying with these requirements, it is important that applicants truthfully accomplish their tax declarations to get a higher chance in the FAFSA program.
Have you already tried processing and submitting FAFSA tax return requirements? Share your experiences with us in the comments section below.