How do I decrease my EFC?

annoyingdad
Sun, 23 Dec 2012 19:45:09 +0000

Pre-tax 401k contributions and traditional IRA contributions for which you take a deduction on the 1040 reduce AGI. So they are added back in. It’s considered a choice to contribute to retirement rather than fund education. Roth IRA and 401k contributions are after tax so don’t reduce AGI. Neither do traditional IRA contributions if you don’t take the IRA deduction.

Yes, in the years following an added back-in contribution, that amount is just part of a non-reportable asset.