FAFSA Simplification

The FAFSA Simplification Act was passed into law as part of the Consolidated Appropriations Act of 2021. The Act represents a significant overhaul of the federal student aid process, including the Free Application for Federal Student Aid (FAFSA) form, need analysis and eligibility calculations, and many policies and procedures for schools that participate in Title IV programs. These changes will greatly enhance the user experience and should drastically reduce the time to complete the application.

  1. Admissions & Costs
  2. Financial Aid
  3. Resources & Forms
  4. FAFSA Simplification

Changes Related to the New Student Experience

Changes to the application and data collection process are expected to improve and streamline the user experience. A high-level summary of changes related to the application and analysis of the information collected includes:

  • The number of questions asked on the FAFSA has been reduced
  • Anyone who is required to provide information on the FAFSA is referred to as a Contributor. All contributors will need their own Federal Student Aid (FSA) ID. For dependent students from divorced/separated families, there has been a change regarding which parent must provide information on the FAFSA as a Contributor. There will be a tool for the students to use through the process to determine which parent(s) should be invited as a contributor.
  • Federal tax information (FTI) requested in the FAFSA will be received directly from the Internal Revenue Service (IRS) for U.S. taxpayers through a Direct Data Exchange process. All contributors must consent to have their FTI transferred from the IRS for the student to be eligible for federal, state, and some institutional need-based aid.
  • The Student Aid Index (SAI) will replace the Expected Family Contribution (EFC).
  • Access to the Federal Pell Grant has been expanded with eligibility linked to Adjusted Gross Income (AGI), family size, federal poverty levels, and SAI in certain scenarios.
  • The Student Aid Report (SAR) that students receive upon submission of their FAFSA will now be called the FAFSA Submission Summary (FSS).

The Student Aid Index (SAI) will replace the Expected Family Contribution (EFC) as of the 2024-2025 award year. The SAI reflects an evaluation of a student's approximate financial resources to contribute to the student's post-secondary education for an academic year.

Notable changes to the federal SAI methodology include the following:

  • The new formula allows a minimum SAI of negative $1,500 to give more insight when determining a student's aid.
  • The number of children in college is not considered in the SAI calculation.
  • The formula reduces the number of data items and allowances against income, with untaxed income data items removed from the FAFSA.
  • Allowances (amounts subtracted) against assets will be based on the age of the older parent in two-parent households.
  • Annual child support received will now be an asset and reported based on the last complete calendar year. Which year is used will be based on when the FAFSA is completed. For example, if the FAFSA is completed in December 2023 when it opens, child support received would be reported from 2022 totals. But, if the FAFSA was completed in 2024, the child support received would be reported from 2023 totals.
  • Business net worth will now be reported regardless of the business size.
  • Family Farm net worth will now be reported, except for the part of the farm that is the family's primary residence, which should be deducted from the total net worth.
  • The applicant's family size will be based on the tax data used for the FAFSA application and downloaded directly from the IRS. The Contributor can update the family size if the number has changed since the tax year of the federal tax information (FTI) was downloaded.
  • The contributing parent providing consent for the tax data being used in the calculation has changed and is no longer the parent the student lives with the most but, instead, the parent who provides the most financial support. There will be a tool for students to use through the process to determine which parent(s) should be invited as a contributor.

The Act introduced the new term Contributor, which refers to anyone required to provide information on the FAFSA form. For dependent students, this includes the student and the student's parent(s) (biological, adopted, and/or step-parent, if applicable). For independent students, this includes the student and the student's spouse, if applicable.

All Contributors must have a Federal Student Aid (FSA) ID to log in and complete their portion of the FAFSA application. It is highly recommended that each contributor create their FSA ID before the 2024-2025 FAFSA Application launch in December of 2023 to help streamline completing the form once it is available.

Contributors must consent to have their federal tax information (FTI) transferred from the IRS. Consent authorizes direct access and disclosure of IRS data and allows for disclosure of that information to state entities, institutions, and scholarship organizations. If any contributor refuses to consent, the student will not be eligible for federal, state, and some institutional need-based financial aid.

NOTE: For situations where the tax return was filed jointly (i.e., biological and/or step-parents filed "married filing jointly') in the prior-prior year, only one parent would need to establish an FSA ID to provide consent. If married independent students filed jointly with their spouse in the prior-prior year, only the student will need to consent. However, if the filing status was "married filing separate," or if the Contributors originally filed single in the prior-prior year, but are now married, both parties would need an FSA ID and need to provide consent. There will be a tool for students to use through the process to determine which parent(s) should be invited as a contributor.

The law has changed for students from divorced/separated households regarding which parent is to complete the FAFSA. The law now requires the parent who provided the greater portion of the student's financial support during the prior 12 months to complete the FAFSA. The new FAFSA application will have a "Who is my parent?" wizard tool to assist students in determining which parent should be included as a contributor. If the parent who provides the greater financial support has remarried, the step-parent's information must also be included. If both parents provided equal support, then the parent with the greater income will be the required contributor on the FAFSA.

Housing Component Assignment:

The housing question has been removed from the 2024-2025 FAFSA. Starting with the 2024-2025 academic year, dependent students will be assigned a living-with-parent(s) at-home cost of attendance budget. Independent students will be assigned a not-living-with-parent(s), not-at-home cost of attendance budget. The student must notify the Financial Aid Office in writing if this budget component is incorrect and does not represent their housing situation.

Cost of Attendance Components:

The Consolidated Appropriations Act has changed some terms used in the cost of attendance information.

  • Room will now be referred to as "Housing" on the cost of attendance information.
  • Board will now be referred to as "Food" on the cost of attendance information.

 

The 2024-2025 Free Application for Federal Student Aid is now available. Here are a few items you'll need to complete the form. For more detailed information, you may review these Federal Student Aid (FSA) tips.

  • Your StudentAid.gov Account
  • Your Contributor Information
  • Your 2022 Federal Income Tax Return
  • Records of Your Untaxed Income
  • Records of Your Assets
  • List of Schools You're Interested in Attending