<p>Do you guys think BU was justified in decreasing my Financial aid by 22,000?</p>
<p>Freshman year I paid $22,000. This year, I will pay $44,000.</p>
<p>They did this because I make ~$45,000 which is $33,750 a year after tax making Youtube videos</p>
<p>This absolutely infuriates me because I use all of my free time and I work my ass off every weekend to make this money. I literally finish all my schoolwork and then go straight to actual work with little to no break missing out on social activities and such just so I can pay off my tuition. And what do I get in return? An additional $22,000 more I have to pay.</p>
<p>It’s like the harder I work, the more I will get punished.</p>
<p>Seriously, is there any way I can convince FA to give me a break?</p>
<p>You paid $22,000 last year. This year you will pay an additional $22,000 but your income is actually $33,000. Sounds to me like you have a net gain of $11,000.</p>
<p>I seriously doubt you will receive any additional aid. You earned a large sum of money…and that reduced your financial need significantly. Plus if you have any of this money, it would be considered an asset.</p>
<p>I hope you saved this money for college expenses.</p>
<p>Did you earn $33,000 take home pay last year? If not…you somehow paid the $22k last year with out that money. You have to come up with $22k MORE…but you earned $33k more (I’m assuming you were not a big wage earner last year).</p>
<p>Actually, I made more last year. I payed off the 22k with 20k left in the bank. If the FA stays this way, I will lose all that money by the time I graduate. :(</p>
A typical student does not make that much money while he is studying. Did anyone tell you if you make more $6000, the school will decrease your financial aid?</p>
<p>If you knew you were going to make that much money last year, you should’ve incorporated and set yourself up so that you would be paid only $6000 or so by your own business. Unfortunately, what’s done is done and you really can’t hide it anymore for this year. Your first priority should be to find and hire a good tax accountant, so he can help you reduce your personal income for next year so hopefully you can get more aid next year.</p>
<p>Wouldn’t they know it was my business and how much profit i’m making? Can you further explain how would I be able to hide or reduce my personal income? Thanks</p>
<p>Why? The OP made $33k after taxes and the financial aid office says its share is 130% of that.</p>
<p>I’m going through a similar thing (although I’m a parent). I made a little more last year (like $10k) and the FAO at my kid’s college wants well more than 100% of it. Posters on this forum who claim financial aid will be reduced by a small percentage of an income increase don’t know what they are talking about.</p>
<p>There are a lot of parents who lived well below their means in order to save for their kid’s tuitions, and there a lot of parents who spent money on luxury items. Guess who is paying more?</p>
<p>The OP’s gross income of $45,000 a year is assessed VERY heavily in the financial aid calculation. OP, the school is looking at your AGI and they don’t car whether this is you own business income or a W-2 pay. BUT be advised that any business deductions allowed by the IRS for tax purposes can, and likely were, added back on as income when your financial aid was computed. </p>
<p>You say you earned MORE last year? You are fortunate that you got the aid you got LAST year.</p>
<p>You said that “at the rate you are going, there will be none left when you graduate”? Colleges do NOT give need based aid to students so that they can keep their savings until after graduation.</p>
<p>If you grossed MORE than $45,000 last year, this would mean your income for two years was about $100,000 for which you should be proud. BUT getting additional need based aid with student income in this range is not going to happen.</p>
<p>You have two things that are wonderful.</p>
<p>First…you clearly have a good business going. Congratulations. I’ll echo what others have said…you need a business accountant.</p>
<p>Second, you have earned a good chunk of money for college, and you should be proud. </p>
<p>I know BU is expensive…my kid graduated from BU. but the money you have earned…even netted, would pay the full cost of attendance at any number of colleges. BU is not obligated to provide you with need based aid in additional to your high student income…which is now considered in addition to your parent income when your need is computed.</p>
<p>I have a suggestion…put infor a leave of absence for one year from BU. Get your business accounting in order…work and save, and then return to BU to finish…or transfer to a college you can fund with the money you have.</p>
<p>If you incorporate and use a C-corp, you can validly say that the business is its own separate entity and they shouldn’t be able to assume anything about it. Unfortunately, since they already know you made so much $$, you might have a hard problem convincing them to discount it, so yes, that might be an issue. Thumper1’s advice of taking a break, growing your business for a few months, and then maybe even transferring (maybe to Harvard or MIT? you never know) is an idea worth considering.</p>
<p>You can pretty much deduct almost all living expenses (rent, car, meals, etc.) via a business. But get an “aggressive” but good tax accountant to ensure that you do it right. Consider this an early life lesson though, that if you’re an entrepreneur you should always be pro-active about tax issues. Right now, Uncle Sam does give you a lot of loopholes to legally reduce your taxable income, but you have to be willing to spend the investment/effort to take advantage of them.</p>
<p>Foilist is correct…you can deduct legitimate business expenses for TAX purposes, and you should do so. BUT many deductions allowed by the IRS for business owners for tax purposes are added back in by colleges when computing need based aid…Just don’t be surprised if this happens. </p>
<p>Colleges are not in the business of providing need based aid to help subsidize a family or student business…or to protect savings. They provide need based aid to students who do not otherwise have the recourses to pay college expenses…and many colleges do not meet full need anyway…BU does not.</p>
<p>It sounds like the advice is to incorporate a business which deducts a bunch of your expenses while you take a low salary so that only your salary shows as income.</p>
<p>Lose money? You are not losing anything. You are spending it on your education, with the most important word being “your.” You can’t really expect for other people to pay for your education while you save for later?</p>
<p>I don’t think BU will look at OP’s 3rd year finaid request and blindly accept that now he’s earning less, just because he incorporated in a certain way and designated himself a lower salary. BU follows its own needs in awarding aid and will certainly know the context. There are no easy guarantees. I think they’d smell a fish. Isn’t there also a Profile question about any C corps you have stake in? Plus the IRS tax ramifications for C corps.</p>
<p>Thanks for all this great advice. I also have a sister who’s attending SUNY Optometry school which is also like 25,000 a year, my parents are giving her loans and she’s taking some out aswell. We were thinking of turning my job into a business and making her an employee who would received maybe 8,000 so that way my income would appear less. But what you guys are suggesting is to just put most of my money into the business and set my own salary as around 8,000?</p>
<p>Anyways, i’m going to your advices and find an accountant, I hope I find a good one.</p>