Divorce causes much more than relationship confusion between parents and children. It also creates confusion regarding finances involving the child. This is even more true for the college student with divorced parents. If you’re applying for financial aid and your parents are divorced, you may be wondering how does this affect your financial aid? Unfortunately, there is no clear-cut answer because it depends on the arrangements your parents have regarding your welfare. These patterns relate to which parent you reside with most of the time, who pays the most for your care, and even makes the most money out of your parents.
Financial Aid: It’s About How Much You or Your Parents Make
When determining eligibility for financial aid, colleges rely upon the Free Application for Federal Student Aid (FAFSA). The FAFSA is where you supply financial information to the federal government to determine your eligibility for federal student aid. Most colleges also rely on this same information. Unless you’re determined to be an independent student, you’ll have to report your parents income. This part of the FAFSA gets tricky for you if your parents are divorced because you have to decide which parent’s financial information to provide.
Which Parent Do I Include?
According to the Department of Education, you report the income of your custodial parent. Who is your custodial parent? It is the parent that you lived with the majority of the time in the previous 12 months from the date of signing your FAFSA. If you lived with one parent more than the other, then you would use the tax return for that parent.
Some times, deciding which parent is the custodial parent is not so easy, such as if your parents have joint custody. In cases like these, there is a second determining factor. If this is your situation, you would include the information for the parent that provided you with the most financial support. Once again, if your parents support you equally, a third test is applied to your situation.If your parents share time and support equally, you’d use the parent with the greater income.
So, when determining which parent’s financial information to include on your FAFSA:
1. Choose the parent that you live with the majority of the time, or
2. Choose the parent that provides the majority of your support, or
3. Choose the parent that with the greater income.
Things to Consider
The Department of Education has different rules than the IRS. Financial aid eligibility doesn’t take into consideration which parent claims you on tax returns. Also, if your custodial parent is remarried, you have to include the income of your stepparent. Finally, your college of choice may have different requirements than the federal government. While most colleges use the FAFSA to determine local eligibility, your college may tack on different or additional requirements. For example, the financial aid administrator for your college makes the final determination as to which parent you include, and he/ she may require documentation to support the information you included.
Divorce is a Tangled Web, But Doesn’t Have to Be
Yes, divorce does make for tricky situations, especially when applying for financial aid, but if you take the time to determine which parent’s financial information to use before completing your FAFSA, you can easily avoid the entanglements. The thing to remember is that your applying for money. Take your time and do it correctly.