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FAFSA Line 43a. Student Education Credit

rikkyjayrikkyjay Registered User Posts: 3 New Member
I have searched everywhere and I don't know how to fill this one in. It says that this is from 1040 line 49 and 1040A line 39. I have filed a 1040EZ and have an amended tax return to get my form 8863. It has been approved but I am still boggled as to how to fill this one in. My school changed a few lines on my FAFSA and it was for the selective service. I also changed this line and put the amount on form 8863 from line 30.

Is that right?
Also they said to register me for selective service and I was already registered in 2007. I was wondering if thats right because it lowerd my EFC to 0.
Post edited by rikkyjay on

Replies to: FAFSA Line 43a. Student Education Credit

  • rikkyjayrikkyjay Registered User Posts: 3 New Member
    Bump

    I sent in a letter giving them my SS number. I am just boggled because when they corrected my FAFSA, they changed line 36 because I had put the wrong amount. I changed it back to what they had it to but had also put that I'm already in the Selective Service and that I had an education credit or line 43. From my form 8863. Im not sure if I had put in the right numbers from form 8863.
  • swimcatsmomswimcatsmom Registered User Posts: 15,953 Senior Member
    You should only put the part of the education credit that would appear on line 49 of your 1040 (or line 31 of 1040a). You don't put the part that would appear on line 66 of 1040 (or line 40 of the 1040a.)

    The American opportunity credit is in 2 parts - nonrefundable (60%) and refundable (40%). The non refundable part is treated as a reduction of the total taxes you would owe. FAFSA asks for that because you report the total taxes you owed from line 61 of 1040 (35 on 1040a) on FAFSA. The nonrefundable part of the AOC has reduced the tax owed figure which would have the effect of increasing your EFC because tax owed is an allowance against income in the EFC formula. As the intent of the credit is not to increase your EFC, they ask for the non refundable number and the FAFSA formula adds it back to your tax owed so it does not affect your EFC.

    The refundable part is treated by the IRS as if you had actually paid that amount of tax and it is being refunded to you. You don't report that on FAFSA because it was not included in the tax owed amount reported on FAFSA so had no impact on your EFC.

    If you follow the instructions on FAFSA you will do it correctly. Sometimes they may not seem to be logical, but there is usually a good reason they ask the questions they ask.
  • swimcatsmomswimcatsmom Registered User Posts: 15,953 Senior Member
    If you are trying to find the number from form 8863, it is the line 19 number you want - the nonrefundable credit.
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