FAFSA frequently asked questions


Frequently asked questions about the FAFSA

Below are frequently asked questions about the FAFSA compiled by Concordia's financial aid office. The questions are split into four categories:

If you have further questions, please call 800-535-5494, ext. 7270, or email finaid@cune.edu.

 

Filing the FAFSA

What information do I need to file?

You will need all of your and your spouse's (if applicable) income information for the year designated on the FAFSA. This means federal tax form information, W-2 information and any untaxed income that you would have received. You must also determine amounts in savings accounts, and values in real estate and investments.

How do I file?

The quickest, most efficient way to file is through FAFSA on the Web (FOTW). Their website is www.fafsa.gov. Never pay anyone to file your FAFSA.

Should I complete and submit my FAFSA in January, even if my tax return hasn't yet been completed?

No. Usually it is best to wait until after you/your spouse's federal tax returns have been filed before completing and submitting your FAFSA. Concordia strongly suggests that you do not file the FAFSA until your tax transcript is available. We urge you to utilize the IRS Data Retrieval Tool (DRT) provided by the FAFSA on the Web (FOTW). The earliest the IRS Data Retrieval Tool (DRT) can be used to retrieve your tax information is February 1st or 10 days after you file your taxes electronically, whichever is the later. IF YOU DO NOT USE THE IRS DATA RETRIEVAL TOOL (DRT) WHEN YOU FILE YOUR FAFSA, YOUR FAFSA WILL HAVE AN INCREASED POSSIBILITY OF BEING SELECTED FOR VERIFICATION BY THE DEPARTMENT OF EDUCATION.

What is the federal FAFSA code for Concordia University Nebraska?

Concordia’s code is 002541 and is entered on your FAFSA in Step 6.

I did not enter Concordia’s code on my FAFSA. Can I still qualify for financial aid?

Yes. You can ‘add’ Concordia to your FAFSA data on-line using your federal PIN and Concordia’s code of 002541. You can also call 1-800-433-3243 and request that your FAFSA data be provided to Concordia.

Must I be admitted to Concordia before submitting the FAFSA?

No. The FAFSA should be completed and submitted during February or March, even if you are not yet fully admitted.

I submitted the FAFSA last year. Why do I have to apply again this year?

Federal regulations require that a student reapply for federal financial aid each year. The primary reason is to ensure that an individual’s eligibility for assistance is based on the most up-to-date income, asset, and family information.

I submitted my FAFSA online several weeks ago. Why haven’t I heard from Concordia? I have not even received an email acknowledgement.

  • Did you list Concordia’s federal code number of 002541 on your FAFSA? If not, the Office of Student Financial Services won’t receive your FAFSA data. Concordia can be added to your FAFSA record at www.fafsa.gov, or by calling 1-800-433-3243.
  • Have you been admitted to Concordia? If not, you cannot yet be offered financial aid. Contact Concordia’s Office of Admissions for application instructions.
  • Does Concordia have your current mailing (and email address)? It not, you may have been notified, but it didn’t reach you.
  • If none of the above is applicable, contact Concordia’s Office of Student Financial Services (800-535-5494, ext. 7270, or finaid@cune.edu) for assistance.
What is a Student Aid Report (SAR)?

A SAR is generated once your FAFSA has been processed. The SAR lists all of the information that you entered on the FAFSA and will have comments regarding any problems or questions the processor has regarding your application. It will also list an Expected Family Contribution (EFC) that will be used to determine your eligibility for grants and loans.

How can I get a copy of my SAR?

You may print a copy of your SAR from the FAFSA website at www.fafsa.gov. Choose “Print Student Aid Report (SAR)” from the site’s main menu.

What if I find a mistake on my Student Aid Report (SAR)?

You may go back to the FAFSA website at www.fafsa.gov and choose “make corrections to a processed SAR.” If you are making corrections to your information, you will need your PIN number to do so. If your parents are making corrections to their information, they will need their PIN number to do so.

On the Student Aid Report, there is a number called an EFC. I understand that is the Expected Family Contribution. When will I have to pay that amount?

The Expected Family Contribution, or EFC, is not an amount you will have to pay for your education. The EFC is a measure of the family's ability to absorb educational expenses over a period of time. This figure is used by the Office of Student Financial Services to determine eligibility for need-based financial assistance.

I won’t qualify for financial assistance. Why should I go to the trouble to submit a FAFSA?

Many families believe their income is too high to receive financial aid. However, low-interest federal loan assistance may be received by a student regardless of family income. Some benefit programs require applicants to also submit the FAFSA even if they may not qualify for need-based federal aid. Example: TEACH Grant

What if I have not filed a federal tax return yet?

You can complete the FAFSA using estimated income; however, your FAFSA will have an increased possibility of being selected by the Department of Education for verification. Federal regulations prohibit a financial aid office to disburse aid to a student (parent if required) who has not completed a federal tax return if they are required to. Your financial aid will not be processed until you make a correction to the FAFSA stating you filed and you use the IRS Data Retrieval Tool (DRT) to retrieve the correct information from your taxes.

Why must I report my housing allowance as a member of the clergy?

The FAFSA considers the portion of your housing allowance that was ‘used’ to be reported as untaxed income. The unused portion of the housing allowance must be reported as taxable income on the IRS 1040 form.

Do I still need to report income if I was not required to file a tax return?

Yes. The FAFSA requires you to report income amounts even if they were less than the minimum amount required to file a tax return.

I don’t understand the different dates for Tax/Base Year and Award Year?

The FAFSA requires financial information for the base year, which is the same as the tax year. For instance, if you are completing the 2012-13 FAFSA, you will provide financial information from 2011. The tax/base year refers to the year of the financial information while the award year refers to the year of the FAFSA being completed. Example: Award Year 2012-13, Tax/Base Year 2011. While financial information is requested for the tax/base year, there are a couple of household questions that refer to award year. Example: How many members are in your household for 2012-13. Make sure you read the instructions for each question carefully.

My parents and I are taxpayers. Don’t I have the right to receive federal financial aid?

No. Eligibility for federal and state financial assistance is based on a student meeting specific eligibility criteria in accordance with federal and state laws.

I’m not comfortable entering my Social Security Number (and my parent’s Social Security Number) on my FAFSA. Do I have to do so?

Yes. Federal law requires that these Social Security Numbers be entered on your FAFSA. However, please be assured that the National FAFSA processing agency and the Office of Student Financial Services at Concordia take every precaution to ensure the security and confidentiality of these numbers.

I plan to get married. Is it better to wait until after I get married to file for financial aid?

Not necessarily. Some students receive more grant funding as a dependent student rather than as an independent student, while an independent student may qualify for more loan funds. You may want to use a financial aid estimator to determine which is best for you. The financial aid estimator is located at www.educationquest.org/estimator/. You may first enter the information as a dependent student using your and your parents’ income. Once you have the results, enter the information as an independent student using your and your spouse-to-be income. Depending on the results, you can decide as to whether you should file prior to getting married or wait to complete the FAFSA after you are married. The deadline to submit a revision to a student's marital status on the FAFSA is the first day of classes each term.

Does Concordia need copies of my family’s tax returns?

Sometimes. If your FAFSA data is selected by the Department of Education to undergo Verification (see our Verification page), you will be required to submit your (and your parents) federal tax transcripts. It is much less likely that you will be selected to undergo verification if you use the IRS Data Retrieval Tool (DRT) provided by the FAFSA on the Web (FOTW).

 

Reporting Net Worth on Cash, Investments, Businesses and Farms

What assets do I need to include on the FAFSA?

An asset is property the family owns and that has an exchange value. The FAFSA collects current (as of the day of signing the FAFSA) data about cash, savings and checking accounts, investments, and businesses/investment farms.

Cash, savings and checking accounts include the balance in savings and checking accounts as of the date the FAFSA is completed. Do not include student financial aid.

Investments include college savings plans, Coverdell savings accounts, real estate, installment and land sale contracts (including mortgages held), trust funds, mutual funds, money market funds, UGMA and UTMA accounts, certificates of deposit, stocks, stock options, bonds, commodities, and precious metals. If the asset isn’t a business or investment farm, it should be reported as an investment.

Businesses and investment farms – see the next question for detailed information on what needs to be reported on the FAFSA for businesses.

The FAFSA asks for the net worth of investments, which is their total current market value minus their associated debts. If their net worth is negative, then report a zero.

Excluded assets—not reported on the FAFSA:

  • Possessions such as a car, a stereo, clothes, or furniture are not re­ported as an asset.
  • A family's principal place of residence is not reported, even if it is part of a business.
  • Family-owned and controlled small businesses – see the next question for detailed information on how a business (including a farm) qualifies as this.
  • Retirement plans and whole-life insurance. The value of retirement plans (401[k] plans, pension funds, annuities, non-education IRAs, Keogh plans, etc.) is not counted as an asset, but distributions (taxed and untaxed) do count as income. Similarly, the cash value or equity of a life insurance policy (often called a whole-life policy) isn’t reported as an asset, but an insurance settlement does count as income. The full amount of the distribution is reported, whether it was a lump-sum or annual distribution, and it will count as taxable or untaxed income, as appropriate. An exception to reporting pension distributions is when they are rolled over into another retirement plan in the same tax year.

I/We own a business.  Should the net worth of the business be included as an asset on my FAFSA? (If your business is a farm please skip this question and see the next question.)

The net worth of a business should be reported on the FAFSA only if it does not qualify as a “family-owned and controlled small business.

In order to qualify as a “family-owned and controlled small business” the business must:

  • have 100 or fewer full-time equivalent employees. The size of the business is based on the number of full-time equivalent (FTE) employees, not the income or assets of the business. Two half-time employees are counted as the equivalent of one full-time employee.
  • be owned and controlled by the family. This means that more than 50% of the voting rights must be owned by your family. For this purpose, your family includes (1) persons directly related to you, such as a parent, sister or cousin, or (2) persons who are or were related to you by marriage, such as a spouse, stepparent or sister-in-law.

If the business is a partnership or corporation where each partner/shareholder owns exactly half of the business, and the family is one partner and a third party is the other, it does not qualify as a family-owned and controlled small business. In order to qualify, the family must own a majority of the business. (i.e. 51% ownership qualifies, 50% ownership does not qualify.) If there is more than one class of stock with different voting rights, the family must own more than 50% of the voting rights in order to control the business.

A business can be any type (unincorporated, incorporated, partnership, LLC, etc.) to be considered a family-owned and controlled small business. Likewise, the tax form you use to report income from your business (ex. Schedule C, Form 1120, Form 1065) does not affect whether the business can be considered a family-owned and controlled small business.

As stated above, if you determine that your family’s business qualifies as a “family-owned and controlled small business,” then you are not required to report ANY assets of the business on the FAFSA. However, you are still required to report your income from the business. If the business is a sole proprietorship then the income will generally be reported on Schedule C. If the business is a pass-through entity (e.g., partnership, S corporation, LLC), the business income attributable to the taxpayer (e.g., through schedule C or schedule K-1) must still be reported on the FAFSA. Likewise, any salaries paid by the business to the family count as wage income on the FAFSA.

If your family’s business does not qualify as a “family-owned and controlled small business’ then you must report your family’s share of the current net worth of the business on the FAFSA.

Business Value – Business Debts = Net Worth of Business

  • Business value is how much the business is worth today. (i.e. the amount for which the business could sell for.)
  • Business debts are what you owe on the business. Include only debts for which the business was used as collateral.

A family's principal place of residence is never reported on the FAFSA, even if it is part of a business that does not qualify as a “family-owned and controlled small business.”

If your family has rental income (generally reported on Schedule E) from property owned by the family (i.e. the deed to the property is in the family’s name) to someone else then this is considered rental property and you are required to include the net value on the FAFSA. See the below question on real estate for more information. Rental property owned by an incorporated business entity (i.e. the deed of the property in not in the family’s name) that qualifies as a “family-owned and controlled small business” is not required to be reported on the FAFSA since the family-owned and controlled small business exclusion applies.

I/We parents operate or own a farm business. Should the net worth of the farm be included as an asset on my FAFSA?

In general, if your family lives on, owns and actively participates in the farm’s operations you will list a $0 for the net worth of your farm on the FAFSA; however, you must first determine exactly what your family’s circumstance is to be certain.

The first thing to determine is if your family’s farm operation and/or investment in a farm business qualifies as a “family-owned and controlled small business.” If it does qualify then you are not required to report the net worth on the FAFSA.

In order to qualify as a “family-owned and controlled small business” the business must:

  • have 100 or fewer full-time equivalent employees. The size of the business is based on the number of full-time equivalent (FTE) employees, not the income or assets of the business. Two half-time employees are counted as the equivalent of one full-time employee.
  • be owned and controlled by the family. This means that more than 50% of the voting rights must be owned by your family. For this purpose, your family includes (1) persons directly related to you, such as a parent, sister or cousin, or (2) persons who are or were related to you by marriage, such as a spouse, stepparent or sister-in-law.

If the business is a partnership or corporation where each partner/shareholder owns exactly half of the business, and the family is one partner and a third party is the other, it does not qualify as a family-owned and controlled small business. In order to qualify, the family must own a majority of the business. (i.e. 51% ownership qualifies, 50% ownership does not qualify.) If there is more than one class of stock with different voting rights, the family must own more than 50% of the voting rights in order to control the business.

A business can be any type (unincorporated, incorporated, partnership, LLC, etc.) to be considered a family-owned and controlled small business. Likewise, the tax form you use to report income from your farm operation and/or investment in a farm business (ex. Schedule F, Schedule C, Form 1120, Form 1065) does not affect whether the business can be considered a family-owned and controlled small business.

As stated above, if you determine that your family’s farm operation and/or investment in a farm business qualifies as a “family-owned and controlled small business,” then you are not required to report ANY assets of the business (land, buildings, machinery, equipment, livestock, etc.) on the FAFSA. However, you are still required to report your income from the farm business. If the farm business is a sole proprietorship then the income will generally be reported on Schedule F. If the business is a pass-through entity (e.g., partnership, S corporation, LLC), the business income attributable to the taxpayer (e.g., through schedule C or schedule K-1) must still be reported on the FAFSA. Likewise, any salaries paid by the business to the family count as wage income on the FAFSA.

If your family’s farm operation and/or investment in a farm business does not qualify as a “family-owned and controlled small business’ then you must report your family’s share of the current net worth of the business on the FAFSA.

Business Value – Business Debts = Net Worth of Business

  • Business value is how much the business is worth today. (i.e. the amount for which the business could sell for.)
  • Business debts are what you owe on the business. Include only debts for which the business was used as collateral.

A family's principal place of residence is never reported on the FAFSA, even if it is part of a farm operation and/or investment in a farm business that does not qualify as a “family-owned and controlled small business.” Additionally, assets on a “family farm” (including buildings, equipment, livestock, etc.) aren't reported on the FAFSA if:

  • it is the principal place of residence for the applicant and his family (spouse or, for dependent students, parents), and
  • the applicant (or parents of a dependent student) materially partici­pated in the farming operation.

If your family has farm rental income (generally reported on Form 4835 or Schedule E) from property owned by the family (i.e. the deed to the property is in the family’s name) to someone else then this is considered rental property and you are required to include the net value on the FAFSA. See the below question on real estate for more information. Rental property owned by an incorporated business entity (i.e. the deed of the property in not in the family’s name) that qualifies as a “family-owned and controlled small business” is not required to be reported on the FAFSA since the family-owned and controlled small business exclusion applies.

I/We own real estate that is not our principal residence.  Should the net worth of these assets be included on my FAFSA?

The net worth of real estate that is not your principal residence and is owned by your family (i.e. the deed of the property is in the family’s name) is to be reported as an investment on the FAFSA. This includes farm ground being rented out.

The net worth is determined by taking the market value of the real estate and subtracting the amount of related debt.

A unit within a family home that has its own entrance, kitchen, and bath and that is rented to someone other than a family member, counts as an asset. (A rented bedroom would not count therefore.)

To calculate its net worth, multiply the net worth of the entire structure by the fraction the rented space represents. Similarly, if a family owned a ten-unit apartment building and lived in one of the apartments, 9/10 or 90% of the net value of the building would be an asset.

At times a family will claim rental property as a business. Generally, it must be reported as real estate instead. A rental property would have to be part of a formally recognized business to be reported as such, and it usually would provide additional services like regular cleaning, linen, or maid service.

 

Regarding FAFSA Verification

What is Verification?

Verification is a FAFSA information auditing process. The majority are chosen by the Department of Education. Verification allows us to check the accuracy of the information our students are submitting on their FAFSA. If you are chosen, there will be a comment on your Student Aid Report (SAR) and we will notify you by mailing a verification worksheet and document request. You and your parents, if required, will need to complete a verification worksheet and submit a copy of your federal tax transcripts and W-2 forms.

What do you do with the verification materials?

Our staff compares your tax transcripts and other verification items to your FAFSA information. If a discrepancy is found between the two, a correction is electronically submitted to the Department of Education. Once the correction has been received, we can continue processing your financial aid. The information contained in your tax documents is kept confidential.

I have been selected for Verification three years in a row. Am I doing something wrong? Why do I keep being chosen?

The Department of Education selects applications for verification for a number of reasons. Concordia also reserves the right to select a student for verification. Students are typically selected for verification for the following reasons:

  • Applicant did not use the IRS Data Tool Retrieval (DRT).
  • The submitted application has incomplete data.
  • The data on the application appears to contradict itself.
  • The application has estimated information on it.
How do I request a tax transcript?

You may request a tax transcript from the Internal Revenue Service (IRS) by calling 1-800-908-9946, select Option 2 and enter the correct tax year. You may also go to www.irs.gov. In the “Online Services” section click “Order a Tax Return or Account Transcript”. Click “Order Transcript” and enter all other requested information including the correct tax year. You may also complete a 4506T-EZ which can be downloaded and printed from www.irs.gov and mail it to the IRS to request a transcript. A tax transcript is a summary of your tax return and is sufficient for verification purposes. Be sure to specify the tax year you need. When you receive the transcript, submit it to the financial aid office.

What if I have not filed a federal tax return yet?

You can complete the FAFSA using estimated income; however, your FAFSA will have an increased possibility of being selected by the Department of Education for verification. Federal regulations prohibit a financial aid office to disburse aid to a student (parent if required) who has not completed a federal tax return if they are required to. Your financial aid will not be processed until you make a correction to the FAFSA stating you filed and you use the IRS Data Retrieval Tool (DRT) to retrieve the correct information from your taxes.

What if I’m divorced but filed a joint tax return?

In this case you would need to submit the joint tax transcript to the financial aid office and detail each line indicating which line items belong to you and your former spouse. You will also need to submit your W-2 statements. Only your income information will be used.

I was selected for Verification, but my spouse doesn't want to submit their federal income tax transcript. Does Concordia have the right to ask for it?

Yes. If a student is selected for Verification, federal financial aid regulations require that follow-up documents certifying the Adjusted Gross Income, Tax Paid, and other income/benefit amounts be submitted to Concordia. If a family elects not to submit the documents, no federal assistance can be authorized for the student.