What should I do?

[carmen2546]

<p>I was looking at the FAFSA website, and I am not sure what to do because both of my parents are deceased, but I am too young to be considered an independent student. My parents died pretty recently, so I was never adopted and I don’t have legal guardians or foster parents, I just moved in with relatives. Will I still be able to receive aid? If so, how should I file FAFSA?</p>

[swimcatsmom]

<p>One of the dependency questions asks if your parents are deceased. </p>

<p>

53. Are (a) both of your parents deceased or (b) are you (or were you until age 18) a ward/dependent of the court?You should answer, “Yes” if both of your parents are deceased and you don’t have an adoptive parent. If both your parents are deceased but you have a legal guardian, you should still answer, “Yes” to this question.</p>

<p>Answer “Yes” if you are currently a ward/dependent of the court or were a ward/dependent of the court until age 18.</p>

<p>You are not considered a ward/dependent of the court based solely on emancipation (when a child is released from the control of a parent or guardian) or incarceration.

</p>

<p>Answering yes makes you an independent student regardless of your age so you will file as independent.</p>

[carmen2546]

<p>Oh okay, I thought that it was solely based on age or military service. Thanks. But I have never filed income taxes before, so what should I do about that?</p>

[thumper1]

<p>You do not have to file income taxes to file a FAFSA. The above information is correct. You would be an independent student. Good luck to you in your college search and selection.</p>

[swimcatsmom]

<p>carmen - here is a link to a website that takes you through the FAFSA questions step by step.</p>

<p><a href=“http://studentaid.ed.gov/students/publications/completing_fafsa/2007_2008/ques.html[/url]”>http://studentaid.ed.gov/students/publications/completing_fafsa/2007_2008/ques.html&lt;/a&gt;&lt;/p&gt;

<p>questions 32-47 relate to income <a href=“http://studentaid.ed.gov/students/publications/completing_fafsa/2007_2008/ques3.html[/url]”>http://studentaid.ed.gov/students/publications/completing_fafsa/2007_2008/ques3.html&lt;/a&gt;&lt;/p&gt;

<p>as thumper said you do not have to file a tax return to do FAFSA.</p>

<p>Another think to bear in mind for after you have filed FAFSA - if you are receiving some sort of government benefits due to your parents being deceased these will be shown as income on FAFSA. However if they will cease by the time you start college you will be able to ask your college financial aid officer for a special circumstances adjustment bacause of loss of benefits. So don’t panic.
<a href=“http://www.finaid.org%5B/url%5D”>www.finaid.org</a> has a lot of excellent information about financial aid - I was clueless when we started this process and it has been priceless. One very useful item is the EFC calculator that lets you input your financial information and gives an EFC that I have found to be very accurate (providing the input info is accurate).
<a href=“http://www.finaid.org/calculators/finaidestimate.phtml[/url]”>http://www.finaid.org/calculators/finaidestimate.phtml&lt;/a&gt;&lt;/p&gt;

<p>Good luck and don’t hesitate to come to this board with your questions. Lots of people who are more than willing to help out with information.</p>

[carmen2546]

<p>I do get social security benefits of about 250 a month, also, what should I do about the life insurance money that I have? I know that life insurance isnt taxable income, but I couldnt find any information on the FAFSA website about whether I would have to report that or not.</p>

[thumper1]

<p>If the life insurance is in a savings account, it will be viewed as savings. To be honest, regarding the life insurance, you probably should talk to someone about how to invest it properly. One question for folks who may know the answer…since this student’s only income is SS, and it’s way under $50,000 per year, would he/she qualify for the simplified needs test…not have to report assets?</p>

[Jugulator20]

<p>Social security benefits should be reported on FAFSA student schedule A. Whether these benefits are taxable (and hence included in your AGI) depends on how much other taxable income you have.</p>

<p>Independent student will qualify for simplified needs test if: anyone in the student’s household received benefits during the base year from a designated means-tested Federal benefit program, including SSI, Food Stamps, Free and Reduced Lunch, TANF, and WIC; or </p>

<p>neither student or spouse required to file 1040; and </p>

<p>student’s and spouse’s combined AGI (tax filer) or income earned from work (nonfiler) is less than $50,000. </p>

<p>I agree with Thumper1 that the life insurance is not income, but this money sitting in a bank is considered an asset and needs to be reported on FAFSA as such. However, for federal aid purposes only (Pell grants, Stafford loans, etc), I believe that the life insurance will not be considered because of the simplified needs test. As to a school’s own money, the life insurance may be considered. Remember, a financial aid package may be part federal (or state) money and part out of the school’s own pocket.</p>

<p>Thumper1 is also right about getting advice about investing the life insurance. But be careful as if you invest in say stocks and sell for a profit, if you have to report the capital gains, I believe the capital gains you earn has to be reported on Schedule D 1040 (long form), and hence the standard FAFSA calculation may be used (i.e., no simplified needs test.) and for federal aid purposes, the life insurance would be considered. </p>

<p>Good luck</p>