FAFSA and Retiree parents

swimcatsmom
Sun, 10 Feb 2008 16:26:04 +0000

I am sorry for your loss. I am afraid there are not really any special treatments for being retired. FAFSA asks for untaxed SS retirement income on one of the worksheets so that it can be added to the income from your 1040 for FAFSA purposes. If it is taxed retirement income it is already included in the 1040 as income so is not asked for seperately. It is not treated any different to any other income by FAFSA.

Where it says not to include the value of life insurance I believe it means policies you have that are not paid out. If the policy has been paid to you you have to include it.

To be excluded from assets as retirement savings the money must be in a retirement account such as a 401k or IRA.

There is an amount of asset protection in FAFSA that is based on age. That will protect some of the assets but not a lot. Are you able to file a 1040a or 1040ez? If your income for 2007 was under $49,999 and you are able to file a 1040a or 1040ez you would qualify for a simplified needs test in which case non of your assets would be considered by FAFSA.

The other possibility is to file FAFSA then ask the financial aid office at your school if you have any grounds for a special circumstances adjustment. I do not know if there would be something that covers your situation but you should ask. Good luck.

Oh finaid does have some information about how a special circumstances adjustment might be approached here