Child support received and Automatice Zero for FAFSA

Has anyone actually had experience with this situation? Adjusted Gross Income qualifies us for Automatic Zero. However if I add Child Support it wouldn’t. I’ve spent a few hours trying to find out about this situation, so if you have actual experience it would be helpful! Thanks!

Child support is considered Untaxed income on the FAFSA and must be reported (sorry about the typo gang I was typing on my phone)

However, if you pull up the the EFC formula at if so.ed.gov you will see the worksheet that says if you taxable income is below the threshold that you would be eligible for an auto EFC if you have meet the other criteria.

Hi - yes I know child support must be reported. I’ve done 4 FAFSAs. I am trying to find someone who has actually done this, but thanks for your comments!

I’m not sure what you’re asking. Actually done what? If Child Support takes you above the AGI amount for the Auto Zero then that’s it.

Does your child support take you above $25,000 a year in income? I believe that is the threshold for the auto $0 EFC. If so, you would not be eligible for auto $0 EFC.

https://bigfuture.collegeboard.org/pay-for-college/paying-your-share/expected-family-contribution-calculator

Try an EFC calculator and see what you get.

Child support should not be taxable income. But FAFSA also considers untaxed income.

How much does the child support raise the EFC?

You qualify for the auto zero or the reduced assets based on the tax return number AGI, not on the number once FAFSA ‘add backs’, like child support and 401k contributions, so once you qualify, you should stay qualified. My experience wasn’t with child support but 401k contributions. Once the taxes put me in simplified assets, adding back the 401k contributions didn’t take me out of the simplified asset qualification.

It depends on your state, but for most states, if you qualify for automatic 0 or simplified assets, the FAFSA prompt will ask if you want to put in your assets. If you say no, it will skip almost all the questions and just take you to the signature page.

So…AGI doesn’t include child support payments? Is that correct?

@Madison85

https://www.irs.gov/Help-&-Resources/Tools-&-FAQs/FAQs-for-Individuals/Frequently-Asked-Tax-Questions-&-Answers/Interest,-Dividends,-Other-Types-of-Income/Alimony,-Child-Support,-Court-Awards,-Damages/Alimony,-Child-Support,-Court-Awards,-Damages-1

Child support is not taxable income. But it is included as untaxed income on FAFSA.

What the OP is asking is if adding the child support changes the status of Auto 0 or Simplified Assets, which is determined by IRS taxable income not FAFSA definition of income with add-backs. IMO, the child support received will not change that status since it is not income by IRS definitions, and is not part of AGI. Yes, a parent could receive thousands in child support and the child could still qualify for Pell.

Child support doesn’t even show up on the tax return, @thumper1, so it is not in AGI or even in taxable income - it’s just not part of the IRS tax system. 401k deductions are not on the tax return but you can see them on the W2. IRA contributions are ‘above the line’ so not in AGI.

Sorry the typos gang; I was typing on my phone. Child support is included as untaxed income on the FAFSA.

Here is the link to the EFC table

If you pull up the the EFC formula at if ifap.ed.gov you will see the worksheet that says if you taxable income is below the threshold of $25,000, that you would be eligible for an auto EFC if you have meet the other criteria.

here is the link

https://www.ifap.ed.gov/efcformulaguide/attachments/100615EFCFormulaGuide1617Attach.pdf

On page six of the EFC formula Sybbie posted it says the combined income of parents must be under $25,000.

For tax filers the parents’ AGI is used.

For non tax filers W2 income of parents will be used plus any income from work not reported on W2.

So it sounds that eligibility income for auto 0 should not be affected by untaxed child support income.

Thank you all!

This seems odd. What if the CP has an income of $12k per year but the NCP is wealthy and paying $10k per MONTH in child support. Are y’all saying that the kid gets a full Pell Grant? If so, that’s nuts.

Remember…in most cases child support ends at age 18 or when the child graduates from high school.

yes, but that assumes no younger kids. I should have stated that the huge CS would be continuing thru college years either for that child or for younger ones.

Yep, life is unfair. I’m sure it doesn’t happen often that a NCP is paying $10k/month to a CP who has no income (including spousal support, because that is income), but it does happen. That student could get a Pell grant and no other financial aid at a CSS school that takes both parents’ income into consideration.

That child would get a Pell Grant anywhere.

But at a CSS school where non-custodial parent income is not considered…they would not get institutional need based aid.

Really $5800 isn’t a lot per year for a residential four year college…and that is the max Pell Grant.

I agree that a Pell Grant isn’t much, but it just seems strange