Possible fraud related situation...

<p>I know this probably sounds stupid of me... </p>

<p>My parents were legally divorced some years ago (before I started college anyway). However, they have always lived together regardless. This was done for the financial benefits with regards to financial aid for school. For a while, I thought that this was some sort of legal loophole they were using, though I had my suspicions at times. I just recently found out that this likely fraud. </p>

<p>On the fafsa, my mother is always listed as the primary provider (which for the most part, she is). However, we are the only two people listed for the household. Now I'm no expert at fafsa or finance related things, but can anyone here please provide me some advice on what to do in this situation?</p>

<p>This is one of those odd areas.</p>

<p>It's not really honest to say that only you and your mom are in the household because it implies that only the mom is paying for the household expenses - when likely your dad is paying for some/half.</p>

<p>If your parents are legally divorced, and not subject to common law rules, I doubt that it constitutes fraud as they are not deceiving anyone about their legal status. It is up to a judge to award a divorce decree, not the DoE. FAFSA rules are very clear that, in the case of divorce, only the custodial parent's info is used. But the term custodial parent may have been misinterpreted by your parents since you obviously spend your time equally with both. If you're using your mom's info solely because she makes less money, but your father actually contributes more to the household and therefore to your support, it is your dad's the parent's income/assets that should be reported. If not, then you're probably fine...you can call the FAFSA help desk (anonymously) and confirm this with them.</p>

<p>If they got divorced solely for the purposes of getting financial aid (which is what you are describing, unless there is more to the story) then this sure sounds like fraud to me, at least from an ethical standpoint.</p>

<p>For the sake of argument. Let's just say your parents are commiting fraud. If you turn them in, have you thought of how that will affect your ablility to pay for college? What will be the consequences? What if your parents get insulted by the thought of you turning them in, and refuse any financial help to you, or any cooporation? My only comment to you is to think it through.</p>

<p>If you live with your parents equally...and they are divorced...the FAFSA guidelines are very clear. You MUST use the parent who has the HIGHER income on the FAFSA. If they have been doing this, there is nothing wrong with what they have done.</p>

<p>If your parents are divorced and you don't live with them an equal amount of time, you list the parent with whom you spend greater than 50% of the time regardless of their income. The other parent is not listed on the FAFSA.</p>

<p>BUT if your parent is paying child support to the family OR is paying bills on your behalf (rent, utilities, health insurance, food, etc)....there IS a spot on the FAFSA for that information.</p>

<p>This whole divorced parents still living in one household is just silly for FAFSA because their incomes aren't being used to support two households (as in normal cases).</p>

<p>"If you live with your parents equally...and they are divorced...the FAFSA guidelines are very clear. You MUST use the parent who has the HIGHER income on the FAFSA. If they have been doing this, there is nothing wrong with what they have done."</p>

<p>That's what I have been doing (my mother says her income is higher than my father's and it can be proven with the proper documents so I'll take her word for it). I also found out that the divorce was not because of financial reasons. Does this change anything?</p>

<p>Your parents are allowed to be divorced and live together. There is nothing against the law in what they are doing. You are living with your parents an equal amount of time. Therefore, you need to report your custodial parent as the one who earns the most. It sounds like this has been the case. The reason for your parents' divorce is not relevant to the financial aid folks.</p>

<p>Thumper is correct. The only thing I will add is that you will need to make sure that you do not include your father in the household size. He should not be included.</p>

<p>Some schools require more than just the FAFSA information - in that case, you might be asked about the non-custodial parent's income/assets. For FAFSA purposes, though, you only report information for the parent with whom you lived the most (or in your case, the parent who contributed the most - which translates to the one who made the most money). </p>

<p>Any questions of fairness, etc. are irrelevant. The rules are the rules. Live-in boyfriends who support a mom aren't counted - neither are live in ex-husbands. If you follow the instructions on the FAFSA, you should be fine.</p>