Recent Changes in Filing FAFSA Form for Financial Aid
In September, President Obama signed an executive order implementing some important changes to the financial aid process including a couple of changes related to the filing of the Free Application for Federal Student Aid (“FAFSA”) form. The first change is the date to file the FAFSA form. The date has been moved to October 1st, from January 1st. This change becomes effective in 2016. This gives families more time to understand what type of financial aid they will be receiving from colleges, which allows students more time to focus on those schools that are affordable. Given the date to file is now October 1st, we recommend that you file it no later than November 15th. We also recommend that you file even if you think you may not receive any financial aid.
The second change is that families can now use “prior-prior” year tax returns when completing the FAFSA form – your tax return from two years ago. For the 2016 FAFSA form, the prior year tax return – 2015 – will still be used as the changes don’t take affect until 2017. For example, a family who has a student attending school in the fall of 2017 will use their 2015 tax return. In 2018, they will use their 2016 return, and so on. Currently, this misalignment of the tax filing period and application period causes families to use estimates on the FAFSA, which causes both errors and a potential future reduction in benefits. This change should help in solving both of those problems.