Previously, at this time of the year, most of the focus related to college planning for rising seniors revolved around admission applications. Some were thinking ahead about financial aid, and more and more schools have been requiring the CSS Profile, a form which can be completed as early as the fall of senior year in high school. Still, most of the focus on financial aid didn’t occur until after the calendar turned to the new year.
However, with the 2017-18 financial aid cycle, this will all change due to the introduction of the new FAFSA.
So what’s new about this upcoming FAFSA?
First of all, it’s available to be completed as soon as October 1 of 2016 for those students applying for 2017-18 financial aid consideration. That is a full three months earlier than it was previously available, as the FAFSA used to carry an opening date of January 1.
The other change is related to the tax information required to complete the FAFSA. Previously, families would need to wait until they had filed their current-year taxes before they could finalize the FAFSA. To meet deadlines or begin submitting the FAFSA on January 1, this often required families to generate financial estimates for their taxes. They would then have to go back and finalize these earlier estimates once their taxes were filed, either through the use of the Data Retrieval Tool or by manually inputting the actual totals.
Starting this year, families will be required to submit tax information from the earlier tax year. In the case of the 2017-18 application, families will use the 2015 tax information to file the FAFSA. Previously, they would have needed 2016 tax information to file the FAFSA.
So what do these changes mean? Essentially, families will be able to fill out the FAFSA sooner using tax information that has already been filed (in a majority of cases). In this way, the FAFSA changes are seen as a way to make the process of completing the FAFSA easier than ever before. It eliminates the need for financial estimates that would previously complicate the process.
Of course, those families that are accustomed to the previous time frames of the January 1 opening date will have to look to schools to see how deadlines will be adjusted. Previously, deadlines were a little over a month out, to a few months out, from January 1. If that holds, schools could require a FAFSA to be submitted before the end of the 2016 year for 2017-18 consideration.
Preparing for the new FAFSA
While tax information makes up a significant portion of the FAFSA, there are other questions as well. A lot of these will be things that families know off the top of their head. However, there will be at least a bit of preparation involved, even with the new FAFSA.
Information that families will want to have readily available includes:
- Social security numbers for students and parents (or other registration numbers for non-US citizens)
- Dates of birth for students and parents
- Recent bank and investment statements
- Statements of untaxed income
- An FSA ID for one parent and the student
The FAFSA will ask about your totals in savings, investments and untaxed income (if applicable). The FSA ID is something that can take a bit of time, but the good part about this is that you can use it for filing in future years. However, this also means that you’ll want to keep the ID and passwords created on file.
Considering the FAFSA is now available starting October 1 for those applying for the 2017-18 aid year, I would recommend that you start getting this information together, including the creation of the FSA IDs, in September.
I’m sure there will be some kinks to be worked out along the way, as is usually the case with these sort of changes. But, in all, this should benefit families, allowing them to check off a financial aid to-do sooner, and ideally easier, than ever before.