FAFSA Simplification: What it Means for You
The FAFSA Simplification & FUTURE Act was passed by Congress in December 2020. The intent of the legislation was to make the financial aid process and eligibility for Federal Pell grants more predictable for low-income students, reduce the number of FAFSA (Free Application for Federal Student Aid) Form questions, streamline the calculation of financial need, expand federal aid eligibility for specific populations and, ultimately improve educational outcomes for low-income students.
While some provisions of the legislation went into effect for the 2023-2024 academic year, most will be implemented for the 2024-2025 academic year (Summer 2024/Fall 2024/Spring 2025).
What Does FAFSA Simplification Mean for You?
- The FAFSA for the upcoming academic year typically becomes available at fafsa.gov on October 1. For the 2024-2025 academic year only, the FAFSA will be delayed and will open online by December 31, 2023. Colleges and universities, however, will not begin to receive students' 2024-2025 FAFSA records from the U.S. Department of Education until mid to late March. Additionally, the U.S. Department of Education is estimating students will not be able to make corrections to their submitted 2024-2025 FAFSA's until late March while schools will be able to make corrections/updates in the weeks following.
- Beginning with the 2024-25 year, the FAFSA will be less complex. The number of questions will be reduced from 108 to approximately 36 and prior-prior year federal tax information will be automatically transferred from the IRS database. All parties whose information will be on the FAFSA (example: parent, step-parent) must provide consent to have their federal tax information transferred. Additionally, all individuals that provide information on the FAFSA must each have their own FSA ID (ex. -in the case of a dependent student, the student, and each parent must now have their own FSA ID). Individuals should each apply for an FSA ID at https://studentaid.gov/fsa-id/create-account/launch if they do not have one already in advance of filing the FAFSA.
- Historically, the FAFSA calculated a student's EFC (Expected Family Contribution), an indicator of the student's financial need that was used to determine eligibility for need-based federal, state and Holy Family aid. Most notably, a student's EFC had to be below a specific threshold to qualify for the Federal Pell Grant, SEOG and the PA State Grant. The EFC is being replaced with the SAI (Student Aid Index). Federal Pell Grant eligibility will now be determined by family size and family income as it ties to the federal poverty level. You can calculate your SAI and determine Federal Pell Grant eligibility using the U.S. Department of Education's SAI calculator at https://studentaid.gov/aid-estimator/ .
- The EFC (Expected Family Contribution) was calculated based on five primary factors: household size, number in college, prior-prior year taxable and untaxable income and assets, for both the student and, for dependent students, their parent(s). The SAI will no longer consider most sources of untaxed income. The SAI will also not consider the number in college. This could impact a student's eligibility for need-based financial aid (i.e.-Pell Grant, SEOG, PA State Grant, Federal Work Study, the subsidy on the Federal Direct Student Loan). Holy Family will roll out a special circumstances/appeal process in the spring for students that may be impacted by these changes.
- In the past, for divorced or separated parent families, the custodial parent (typically the parent the student lived with) provided their information on the FAFSA. Beginning with the 2024-25 FAFSA, the parent who provided the greatest financial support (regardless of living arrangements) will be required to list their information on the FAFSA. If financial support is split 50/50 between both parents, the parent who has the higher income is required to provide their financial information on the FAFSA.
Holy Family’s financial aid office is happy to assist you with the financial aid application process should questions arise. Additional information can also be found at Federal Student Aid - https://studentaid.gov/help-center/answers/article/fafsa-simplification-act.