OP is a teenager. That’s all he was asking. It was all other posters who went off on tangent as usual. In reading the posts, most adults here didn’t know how to treat the monetary gift on tax reporting or FA filing, so I don’t blame an 18 year old not knowing either.
This may actually work. The idea is that the grandparents are gifting money to their daughter (the OP’s mother) to help with her bills. Mom puts the $75k in her personal savings account and transfers to checking account each month to pay bills. In the meantime, mom arranges for a direct deposit of about $5k per month from her paychecks into a 529 account in the student’s name. Then she pays the college bill from the 529.
CSS: This is how the question is worded on the CSS, in the student resources section:
If the $75k gift was wired to the mother’s account, then the mother received the gift.
FAFSA: I found this explanation in Edvisors:
The final sentence in the above paragraph is the key sentence: Parents do not have to report gifts they receive.
What do you all think? Would this work for the OP?
And one more thing to consider: Does your school require the CSS after the first year? The school that my child attends requires CSS and FAFSA the first year. Thereafter, they only want a new FAFSA.
Not if OP is at a Profile school, unless the school disregards any entry on PI-230A when calculating FA. And for FAFSA, it doesn’t matter if the mom uses gift money to pay the school or to pay bills and then use freed up money to pay the school. Money gifted to parents is not a factor on FAFSA.
One of mom’s bills is to pay the college.
You can look up how “paid on behalf of” relates differently to parents vs grandparents or other people.
The issue started how remaining assets will be treated in the next FA cycle. And can he hide this asset next year. We went over some of that. And then asked how OP thinks he and his mom will pay the costs that do remain. No “pie in the sky” or Oh, gosh, it’ll work out, the sun’ll come out tomorrow…
Yes, the last sentence is key.
Thank you everyone so so much for your input. Especially @blossom and @oldfort and @brantly … You guys really did try to understand my predicament and help me sincerely without judging me.
For everyone who is criticizing me, I really am surprised your first reaction is to try point out all of my shortcomings and comment just to blame my actions rather than actually trying to help. My only hope is that, if you ever see another kid in an unfortunate situation like mine, you can have it in your heart to sympathize with the kid at least a little bit, and to recognize that it is less the fault of the hardworking child than it is unfortunate circumstance. Telling me to suck it up and that I’m not unique and that its my fault for choosing my college so too bad doesn’t help anyone in any way. I’m surprised how little empathy people can have.
And @PrimeMeridian I don’t know why you’ve commented so much just to criticize my character. If you didn’t have anything nice or constructive to say, I’m not sure why you would say anything at all. I would never wish my situation on you, but I wish you would understand what it is like for me right now. I hope you can stop writing such hurtful and accusatory and judgmental comments from now on…
I just want to update everyone that I think everything will turn out okay for me. I was super busy today, so sorry for not responding for a while. I called my grandparents (yes they are overseas) and had a long conversation about my financial situation, and how grateful I am to be able to have them help me. They understand it fully, having been there through the horrible divorce. I told them how their gift will likely reduce my financial aid greatly, as it was wired over before we even researched its possible impact on aid (meaning it’s in my moms account already and therefore on bank statement, so we can’t play with it or move it around to our benefit anymore). They are so so generous and have graciously offered to help me in any way I need for all four years, although it pains me to have to ask them that. This is what we’ve decided: I will use most of the 75k for tuition this first year. Then the rest will be spent on a car for me to actually be able to commute to a good job (sounds crazy, but car will be needed sooner or later, and not spending all of the 75k now means it will be sitting around and be assessed as an asset next finaid app time and will likely lose us several thousand more in aid). They will send over more money only after junior year. My mom will be able to pay out 30k or so each for sophomore and junior year if we live really frugally, and I’ll cover a few thousand with my earnings and the rest in loans… a LOT of loans. After junior year, grandparents will send over more money AFTER finaid app is submitted and processed already, so no more penalties will be levied on outside help. That money will help pay for senior year, and help pay off some of the loans borrowed in sophomore and junior year.
And yes, I will be completely honest and report the 75k on the CSS, no matter how much they screw me over. I repeat–for everyone who has disparaged my character–I will report my grandparents’ gift honestly. At this point I’m just hoping the inevitable impact on aid is minimal. I’m hoping they will treat the 75k as a one-time windfall, and not count it again in aid calculations after sophomore year.
Unfortunately I’ll probably be asking my grandparents for over $100,000 after four years… Wow I am ever so grateful for them. I had wished earlier for a resolution that involves not asking my grandparents for more money, but I guess no such solution exists, so I will just bite the bullet and take on the extra costs. This seems the only choice I have.
The only thing now, is that I am considering calling the financial aid office in the future to ask about what the gift will do to my aid (I’ll be reporting it anyway on next year’s app so no harm revealing it, right?) and POSSIBLY ask if the deductions to my aid can be reduced in some way. Does that sound like a feasible idea?
@brantly I just want to respond to your comment (#81) it means a lot to me that you went and found that in an effort to help me out. But my school uses CSS which has a specific question regarding other sources of money my parents received, so I really will have to report it. And I am now content with that decision.
Sorry everyone for kind of an anticlimactic ending (I guess my problem is solved, though not in a very desirable way I admit). I realize there are other kids who have terribly selfish and abusive parents out there who might not have other generous family members to help, and I am lucky to have such family members.
Because your character is morally challenged. You’re the one rationalizing about “arbitrary moral beacons”.
Theoretically, I does seem that the 75K could be sent back to grandparents, and if timing is right it will never show up as mother’s assets on FAFSA.
Then if grandparents send an out-of-the-blue gift each year to mom of say $25K, at the right time of year, this would not count against need based financial aid formulas. Mom could then more easily pay tuition.
Even in the worst case, this could be considered a loan (which might be forgiven upon graduation.)
I suspect that many families do something like this. Is there any downside to such a plan?
I truly hope the OP can attend this school.
I think #81 has the best solution. But I would call the Office of Financial Aid to see what they say about reporting gifts to a student’s parents.
Folks, FAFSA is largely irrelevant for this student. Mom makes too much to qualify for any Pell grant, and subsidized loans may or may not be available. OP’s school requires the Profile, and Profile requires that mom report the $75k gift from the grandparents. Giving it back will do no good, as there is no credit against income available on Profile for gifts given by the student or a parent.
It will still need to be reported as parent income on Profile.
Who is the “they” that is screwing you over? Based on what you have reported so far, the only one who is screwing you over is your father. This “whoa as me” attitude toward the financial aid system is one of the reason that people are criticizing you. Your parent’s combined income is $350k +. It’s not the school’s fault that your father refuses to contribute one dime to your education. You have said that the divorce decree obligated him to pay child support and obligates him to help pay for college, but he has done/will do neither. You have said that he is a practicing physician. Is he in the U.S.? If so, why hasn’t your mother initiated legal action to bring him in compliance with the divorce decree?
Enough of the pity party. Be grateful for the $12k in need based aid that you are receiving from the school, and recognize that your issues are not caused by the financial aid system.
Are you aware that you are limited in the amount of loans you can take out each year?
If you father is a licensed physician in the US, he can be found. And if he was required to help pay for college he should.
I am also questioning the amount in loans, @madison85. Is your mother willing to cosign these loans, and what happens if she doesn’t qualify?
If your dad the surgeon was making $350K when he and your mother were together, he’s probably making a LOT more now. Which is neither here nor there, of course, but if he’s in the U.S., your mother certainly should have gotten him tracked down so he could pay child support (and alimony?), but also college. So…is he in the U.S. or not?
I hope your grandparents are willing to cover a lot more than the $100K you’ve mentioned, because that seems to me the only way this scenario of you graduating from H? or P? is going to work.
@articuno, I’m glad your grandparents are able to help you. You’re very fortunate. I don’t think posters here are trying to be mean to you. I think they’re reacting to how oblivious you seem to be to how good you actually have it and how little empathy you seem to have for students who have great stats but no financial aid fairy to bail them out.
Your mom makes 3x the median US income. If she can afford $30k/year out-of-pocket like you indicated upthread, that’s enough to put you through any number of great schools with zero debt. Add guaranteed merit for your stats and you could probably afford your choice of colleges in the $40-45k range without debt. If you took the federal student loan, you could afford $50k schools and come away with minimal debt. Most students don’t have those options, so it’s tone deaf to complain that you worked so hard but still may not be able to afford the $70k/year school you feel that work entitles you to attend.
Nobody is “screwing (you) over.” Many kids get into great schools that they’d love to attend but have to turn down because they can’t afford it. Their safety nets are their state colleges, or commuting to a local school, or attending classes at a community college as they can afford them. Your safety net is dorming at a ~$30-50k/year college. It wouldn’t do you any harm to think about that for a while.
MODERATOR’S NOTE:
Based upon this comment from the OP, I think the time has come to close this thread; there is just nothing more left to say that has not been said.
Thank you everyone so so much for your input. Especially @blossom and @oldfort and @brantly … You guys really did try to understand my predicament and help me sincerely without judging me.
For everyone who is criticizing me, I really am surprised your first reaction is to try point out all of my shortcomings and comment just to blame my actions rather than actually trying to help. My only hope is that, if you ever see another kid in an unfortunate situation like mine, you can have it in your heart to sympathize with the kid at least a little bit, and to recognize that it is less the fault of the hardworking child than it is unfortunate circumstance. Telling me to suck it up and that I’m not unique and that its my fault for choosing my college so too bad doesn’t help anyone in any way. I’m surprised how little empathy people can have.
And @PrimeMeridian I don’t know why you’ve commented so much just to criticize my character. If you didn’t have anything nice or constructive to say, I’m not sure why you would say anything at all. I would never wish my situation on you, but I wish you would understand what it is like for me right now. I hope you can stop writing such hurtful and accusatory and judgmental comments from now on…
For everyone who doesn’t want to read. Here’s the quick summary. My mom who makes $150k CAN afford 57k a year in college costs if we were able to use grandparents’ gift of 75k to fullest extent (approximately 19k each year over four years). Unfortunately this extra income will reduce my aid greatly, and possibly might get rid of it entirely (currently aid is 12k a year based on my “need” and since 75k is greater thanfour years of that–48k-- then they might decide I have no need for aid at all). My problem is: how can I prevent losing my aid, which I really really do need.
I just want to update everyone that I think everything will turn out okay for me. I was super busy today, so sorry for not responding for a while. I called my grandparents (yes they are overseas) and had a long conversation about my financial situation, and how grateful I am to be able to have them help me. They understand it fully, having been there through the horrible divorce. I told them how their gift will likely reduce my financial aid greatly, as it was wired over before we even researched its possible impact on aid (meaning it’s in my moms account already and therefore on bank statement, so we can’t play with it or move it around to our benefit anymore). They are so so generous and have graciously offered to help me in any way I need for all four years, although it pains me to have to ask them that. This is what we’ve decided: I will use most of the 75k for tuition this first year. Then the rest will be spent on a car for me to actually be able to commute to a good job (sounds crazy, but car will be needed sooner or later, and not spending all of the 75k now means it will be sitting around and be assessed as an asset next finaid app time and will likely lose us several thousand more in aid). They will send over more money only after junior year. My mom will be able to pay out 30k or so each for sophomore and junior year if we live really frugally, and I’ll cover a few thousand with my earnings and the rest in loans… a LOT of loans. After junior year, grandparents will send over more money AFTER finaid app is submitted and processed already, so no more penalties will be levied on outside help. That money will help pay for senior year, and help pay off some of the loans borrowed in sophomore and junior year.
And yes, I will be completely honest and report the 75k on the CSS, no matter how much they screw me over. I repeat–for everyone who has disparaged my character–I will report my grandparents’ gift honestly. At this point I’m just hoping the inevitable impact on aid is minimal. I’m hoping they will treat the 75k as a one-time windfall, and not count it again in aid calculations after sophomore year.
Unfortunately I’ll probably be asking my grandparents for over $100,000 after four years… Wow I am ever so grateful for them. I had wished earlier for a resolution that involves not asking my grandparents for more money, but I guess no such solution exists, so I will just bite the bullet and take on the extra costs. This seems the only choice I have.
The only thing now, is that I am considering calling the financial aid office in the future to ask about what the gift will do to my aid (I’ll be reporting it anyway on next year’s app so no harm revealing it, right?) and POSSIBLY ask if the deductions to my aid can be reduced in some way. Does that sound like a feasible idea?
@brantly I just want to respond to your comment (#81) it means a lot to me that you went and found that in an effort to help me out. But my school uses CSS which has a specific question regarding other sources of money my parents received, so I really will have to report it. And I am now content with that decision.
Sorry everyone for kind of an anticlimactic ending (I guess my problem is solved, though not in a very desirable way I admit). I realize there are other kids who have terribly selfish and abusive parents out there who might not have other generous family members to help, and I am lucky to have such family members.