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IRA and the FAFSA

AllthemuffinsAllthemuffins Registered User Posts: 1 New Member
I'm going to be applying for the Washington State College Bound scholarship, and I had a few questions about what is regarded as income. My sister is attending a private college with a lot of grants and loans, and my mother is attending a public university part time to finish up her masters. Neither of my parents are 59 1/2 (57 and 55) but they are using their IRA.

Will the FAFSA count IRA withdrawals as part of my parents' income?
Post edited by Allthemuffins on

Replies to: IRA and the FAFSA

  • thumper1thumper1 Registered User Posts: 61,355 Senior Member
    Any withdrawals from an IRA are income for financial aid purposes regardless of the age of your parents.
  • mazewanderermazewanderer Registered User Posts: 1,399 Senior Member
    Is it a regular or ROTH IRA. While thumper1 may be right, you may want to check what portion of the distribution is considered as income. For example, a ROTH IRA is penalty free if you used for educational purposes and you pay the tax only on the gains, not on the principal. Again, not a tax expert, but it appears that the interest will definitely count as income as you pay tax on it. I am not sure if the return of the principal will count.
This discussion has been closed.