Filling out the Free Application for Federal Student Aid (FAFSA) used to be a family "stressfest" right after the winter holidays. Parents and students scrambled to estimate their prior-year tax information after the FAFSA became available on January 1, and then had to update the information when they finalized their returns.
The situation improved in 2016, when the U.S. Department of Education changed the rules to use information from tax returns for the year two years prior to the beginning of the school year. In line with this change, the FAFSA for each school year is available on October 1 of the previous year. The FAFSA for the 2018–19 academic year was available on October 1, 2017, and is based on information from 2016 tax returns.
This policy not only removes some of the stress, but is also more in line with college application and admission schedules. Although financial aid deadlines vary by school, it's wise to apply for aid as early as possible at any college a student is considering. Because some financial aid may be awarded on a first-come, first-served basis, knowing more about potential aid could help a student make a final decision among offers of admission.
The FAFSA is required for all federal aid as well as for most state and school-sponsored grants and loans. (You may also need to submit other applications.) The FAFSA uses a formula based on family income and other factors to calculate your Expected Family Contribution (EFC). The EFC is then subtracted from the cost of attendance for a specific school to determine the amount of aid for which your student may be eligible. Aid is typically awarded as a combination of grants, loans, and (in some cases) work-study programs.
You can file your FAFSA electronically — the recommended method — and find deadlines for your state on the U.S. Department of Education FAFSA website at fafsa.ed.gov. Deadlines for specific colleges and universities and related financial aid information can typically be found on the school's website.
For more information on federal student aid, see studentaid.ed.gov.
This information is not intended as tax, legal, investment, or retirement advice or recommendations, and it may not be relied on for the purpose of avoiding any federal tax penalties. You are encouraged to seek advice from an independent professional advisor. The content is derived from sources believed to be accurate. Neither the information presented nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. This material was written and prepared by Broadridge Advisor Solutions. © 2017 Broadridge Investor Communication Solutions, Inc.