Common Mistakes on a FAFSA and CSS Profile form

Common Mistakes on a FAFSA and CSS Profile forms

Financial Aid season is here.  As we help our clients with their FAFSA and CSS Profile forms, we are coming across some mistakes that we would like to bring to your attention. By catching the below items before the information is submitted, you will get a better (and more accurate) result.

529 Plans

  1. These are considered a PARENT asset, NOT a student asset.
  2. The amount that should be reported for 529 plans should include the total value of these plans for ALL students in the household.
  3. If a grandparent/other relative has this plan for the student, do NOT report this amount.

Contributions to Retirement

  1. The amount for contributions to retirement needs to be reported on both the FAFSA and CSS Profile.
  2. There are two types:  Payments to Tax-Deferred Pension and Savings plans, and IRA
    Deductions and Payments to Self-Employed SEP, SIMPLE, and Keogh
  3. Payments to Tax-Deferred Pension and Savings plans are found on W-2 Statements, Box
    12a-12d, and only amounts for codes D, E, F, G, H, and S. Do NOT include amounts from
    DD.
  4. Including these amounts is crucial when entering estimated financial information. If your family makes large contributions and they are not included on the initial filing of the FAFSA and CSS Profile, the family’s EFC will raise drastically after updating the tax information. To prevent financial aid from being taken away, please double check these amounts!

Additional Real Estate (NOT your primary residence)

  1. Amount entered should only include the Equity (Total Current Market Value LESS Amount Owed).
  2. If property is inherited, or shared with another family member, ONLY include percentage of value that applies to the parent on the forms. For example, if total market value is $100,000, and you only own half of the property, then the total market value to report is $50,000.
  3. Time Shares should NOT be included unless there is a value associated with the real estate. If the Time Share cannot be resold, do not include a value for this property.

Social Security Benefits

  1. Student: Do not include taxed or untaxed amount on the FAFSA or CSS Profile.
  2. Parent: Taxable amount is included in Adjusted Gross Income on FAFSA and CSS Profile. Untaxable amount is only included on CSS Profile form.

Business Information

  1. If you have income from a business, this business information must be reported on the CSS Profile form.
  2. Even if the business has no value, by indicating you are self-employed, or show income (profit/loss) on Lines 12, 17, or 18, the Business Form on the CSS Profile must be completed.

Hopefully, these tips will help you to avoid the most common mistakes on a FAFSA and CSS Profile forms.  If you need help, please let us know.

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