If that is not definitive, then the financial aid administrator at the college will make the decision, and this will usually be based on whichever parent has the greater income. Some colleges will follow the logic in a multiple support agreement, but they are under no obligation to do so. Financial aid applications can be somewhat confusing because there are several different criteria applied for different kinds of parenthood:.
As noted above, criteria 1, 2 and 3 are used for determining the custodial parent, with the first criteria being primary. In a situation where the parents split all costs equally without even a penny difference , criterion number 7 is often used. For determining household size the number of family members , criteria 4 is the most important. This leads to the anomalous situation where a student can be counted as belonging to two different households. For example, suppose the non-custodial parent remarries and has college-aged children of his own.
Criteria 4 is also used to determine whether the student has one or more dependents, in the rules for specifying whether the student is an independent student with dependents. Criteria 5 and 6 are not used in the financial aid formulas, but are sometimes used to give an indication of the right choice when the other criteria are insufficient. Criteria 6 is also sometimes used to substantiate claims made under criteria 4. For example, a financial aid administrator may ask a parent for a copy of their tax return, to see whether they claimed the child as a dependent.
However, it does consider child support received by the custodial parent. Many private colleges do consider the non-custodial parent as a potential source of support, and require a supplemental financial aid form from the non-custodial parent. It is best for parents who are in the process of getting divorced to prepare a written college support agreement in addition to a child support agreement.
Such an agreement should specify who is responsible for how much of the college expenses, how many semesters of support will be provided, any limits on annual payments, indexing payments to the tuition at a particular college e. In determining who is responsible for filing the FAFSA, which parent claims the child for income tax purposes is irrelevant.
So the mother in San Diego would not have to worry that her ex-husband's claim of his son on his tax return would jeopardize financial aid chances. Who pays child support is also irrelevant when determining who is the custodial parent. Remarriages matter. A child's eligibility for financial aid can be jeopardized if the custodial parent remarries. When the custodial parent remarries, the new spouse's income and assets must be reported on the FAFSA.
About mostly private schools in the U. In most cases, the schools want financial information from both divorced parents. What schools will do with this information will vary by institution. For more information, watch my interview with Paula Bishop , a CPA in Bellevue, Wash, and financial aid expert, on what divorced parents need to know about financial aid. Comparing the effects of filing jointly versus separately on the Pay As You Earn Plan when your spouse does and does not have federal student loan debt.
Is that worth it? At all? Ian Foss is a Program Specialist at the U. Continue the conversation on Facebook or Twitter. Toggle navigation U. Department of Education.
Student Loans Grants Laws Data. Filing taxes separately can make some income-driven repayment plans more affordable, but you might take a tax hit. Income-Driven Repayment Instead of choosing the year Standard Repayment Plan, many borrowers choose to repay their federal student loans according to their incomes. How you file your taxes affects how your income-driven payment amount is calculated Income-driven repayment plans generally set your student loan payment according to your adjusted gross income AGI.
Any time a joint income is used, your payment is prorated if your spouse also has federal student loan debt.
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