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The impact of divorce on student financial aid

Divorced couples often express concern about obtaining and managing financial aid for their children attending college. Common questions include who is responsible for applying for student aid and paying for college. These questions involving divorce and student aid can overcomplicate a process that need not be difficult.

Who fills out the FAFSA?

The Free Application for Federal Student Aid (FAFSA) should be filled out by the custodial parent. For FAFSA purposes, the custodial parent is the parent who has lived with the child the most during the past year.

If the child has lived with each parent equally in the last year, the parent who provided the most financial assistance or claimed the child as a dependent on a tax return should prepare the FAFSA.

What additional income must be included on the FAFSA?

If the custodial parent is remarried, the stepparent's income and assets must also be reported on the FAFSA. This disclosure is required even if a pre-nuptial agreement was previously signed absolving the stepparent of paying for the child's education, because private agreements like these do not avoid the obligation to disclose for purposes of determining need for federal financial aid.

Alimony or child support payments from the non-custodial parent should also be included on the form.

Because the federal government will consider these child support payments in determining financial aid eligibility, the non-custodial parent will be considered an additional source of support. This means additional financial assistance may be required over and above federal and state aid.

What about college expenses beyond those covered by financial aid?

Divorced couples can prepare a written agreement concerning their children's college expenses and support. The agreement should detail what expenses will be covered by each parent during each semester. It should also include information on which specific items are covered under college expenses as well as how the support is to be paid.

Following these guidelines will ensure a smooth financial aid process for divorced couples.

Source: FinAid, "Divorce and Financial Aid"

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