Dependency Status Dilemmas
Sailing away the winter
blues with ISFAA …
2015 Winter Conference
Today’s Objectives
• Understand the differences between the
definition of dependent the Internal Revenue
Service (IRS) uses and the definition the
Department of Education (ED) uses
• Review the dependency status questions
• Discuss specific scenarios you may see in your
office
IRS “Dependent” and FAFSA “Dependent” Not Equal
IRS Definition
The IRS defines the term dependent as
• A qualifying child
• A qualifying relative
• Several criteria to determine dependency
status on the FAFSA
• To be considered independent a student must
answer “yes” to 1 of the dependency status
questions
Age, Marital Status, and Degree Questions
Age, Marital Status, and Degree
Questions
• Were you born before January 1, 1991?
• As of today, are you married?
• At the beginning of the 2014–2015 school
year, will you be working on a master’s or
doctorate program?
Penny
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20 years old
Has no dependents
Completed 2013-2014 FAFSA in January
Got married on February 14, 2013
Has lived with her fiancé since 2012
Pays 50% of their living expenses
Parent provides very little financial support
Penny came into the office in March 2013
stating that her friend told her she should have
waited until she got married to complete the
FAFSA. Can she change her information after
February 14 ?
Do you change her marital status to married and
thus make her independent?
Change Marital Status
FAAs have the discretion to require an applicant
to update his/her marital status, if the
institution determines the update is necessary
to:
– Address an inequity; or
– Reflect more accurately the applicant's ability to
pay
Change Marital Status
• When a student changes marital status using FAFSA on
the Web
• EFC will not be calculated and reject 21 is set
• Confirmation message:
• “You reported a marital status date that is after the
date you submitted your original FAFSA. Therefore, we
cannot calculate an estimated Expected Family
Contribution (EFC). You must contact your Financial Aid
Administrator (FAA)”
• Only a FAA can override the reject
Penny
After Penny got married on February 14 she
realized it wasn’t the best decision for her and
after 10 months of marriage got divorced on
December 15, 2013. It is now January 15 and
she is in the process of completing her 2014-15
FAFSA
Penny
• Based on the following information will what
is Penny’s dependency status?
• Age 21
• Doesn’t have dependents
• Receiving alimony of $500 per month
• Living with parents and pays $250 for rent
Answer is: Dependent
Military Service Questions
Military Service Questions
• Are you currently serving on active duty in the
U.S. Armed Forces for purposes other than
training?
• Are you a veteran of the U.S. Armed Forces?
Military Service Questions
The student is independent if he/she is
• A veteran
• On active duty in the U.S. Armed Forces for
purposes other than training
Veterans
To be considered a veteran, the student must
have been
• In active service, including basic training
• Released under a condition other than
dishonorable
National Guard Members
• National Guard and Reserve members are only
considered veterans if they were called up to
active federal duty by presidential order for a
purpose other than training
• The student must have had a character of
service that was not dishonorable
Documentation
• Financial Aid Office can request a copy of the
DD214
• Certificate of Release or Discharge from Active
Duty
• Character of Discharge must be anything other
than dishonorable
Leonard
• 19 years old
• Was called to active duty by order of the state
governor
• Will complete active duty in May 2015
• How Should Leonard Respond?
Are you a veteran of the U.S. Armed Forces?
If a National Guard or Reserve enlistee is called
to active duty only for state or training
purposes, they are not a veteran for financial aid
purposes
Dependents Receiving Support
Dependents Receiving Support
• Do you now have or will you have children
who will receive more than half of their
support from you between July 1, 2014, and
June 30, 2015?
• Do you have dependents (other than your
children or spouse) who live with you and who
receive more than half of their support from
you, now and through June 30, 2015?
Children Caveats
• Children do not necessarily need to live with
the student
• The student needs to be providing more than
50% of the child’s support
• Unborn children can be included
• The student must provide more than 50% of
the unborn child’s support from date of birth
to the end of the award year
Leslie
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Has a son - Dillon
Lives at home with her parents
Parents pay all of Leslie’s expenses for Dillon
Has no income
She does not receive any support from the father
How should Leslie respond?
Do you now have or will you have children who
will receive more than half of their support from
you between July 1, 2014, and June 30, 2015? NO
• If the student is living with a parent who is paying for
most of the household expenses, the parent would
usually be considered the primary source of support
to the child
• If one or both parents are directly or indirectly
providing more than 50% support for the child
Receiving Support to Raise a Child?
YES
• Leslie receives child support and participates
in the Supplemental Nutrition Assistance
Program (SNAP)
• This is the primary support for her child and
amounts to more than 50% of the child’s
support
Bernadette
• Lives on her own with her child
• Earns $3,500/year
• Receives Temporary Assistance to Needy Families
(TANF)
• Receives child support from the father that
amounts to more than half of the support for
their child
How should Bernadette respond?
Do you now have or will you have children who
will receive more than half of their support from
you between July 1, 2014, and June 30, 2015? YES
If Bernadette is receiving money for the child
from any source other than her parents, she
would be independent if that support accounts
for more than half of the child’s support
Howard
• Answered Yes to question about having child
and providing more than half of the support
for the child
• Howard is the father of Bernadette’s child
Did Howard complete his FAFSA
correctly? YES
• Howard would also be able to count the child
as a dependent and in his household size
Not every student fits this example
Documentation
If you are questioning the student’s response,
what type of documentation do you collect to
determine if the student is providing more than
half of their child’s support?
Dependent Caveats
• For a dependent other than a child to be
included, that person must live with AND
receive more than half of their support from
the student as of the FAFSA signing date and
continue to do so for the remainder of the
award year
Not in the Care of Parents
FAFSA Questions
• At any time since you turned age 13, were both
of your parents deceased, were you in foster
care, or were you a dependent or ward of the
court?
• As determined by a court in your state of legal
residence, are you or were you an emancipated
minor?
• As determined by a court in your state of legal
residence, are you or were you in a legal
guardianship?
Caveats
• A student who was an orphan—both his or
her parents were dead—by age 13 or older is
independent even if he or she was
subsequently adopted
• A student who was at any time since the age
of 13 a foster child or a ward of the court is
independent even if his or her status changed
later
Caveats
• A student is a ward of the court if the court
has assumed legal custody of him or her
• In some states the phrase ward of the state is
used
• This is considered the same as a ward of the
court for dependency status
• Someone who is incarcerated is not
considered a ward of the court
Caveats
• To be considered emancipated or in a legal
guardianship, the arrangement must have
been adjudicated by a court in the student’s
state of legal residence
• Students in legal guardianship to their parents
are not considered independent
Sheldon
• Sheldon states he is in a legal guardianship on
the FAFSA
• During verification Sheldon indicates
• Mom is still alive living in another state, dad is
deceased
• Mom sent Sheldon to live with his
grandmother when he was 13 years old
• Mom visits occasionally during the holiday
Is Sheldon Independent for Financial Aid
Purposes? NO
• Grandma never legally adopted Sheldon, nor
is she Sheldon’s legal guardian
Unaccompanied, Homeless Youth
McKinney-Vento Homeless Assistance
Act
• The College Cost Reduction and Access Act,
which added these dependency statuses,
references the McKinney-Vento Homeless
Assistance Act
• This act requires every school district
designate a homeless liaison
FAFSA Questions
• At any time on or after July 1, 2013, did your high
school or school district homeless liaison
determine that you were an unaccompanied
youth who was homeless or were self-supporting
and at risk of being homeless?
• At any time on or after July 1, 2013, did the
director of an emergency shelter or transitional
housing program funded by the U.S. Department
of Housing and Urban Development determine
that you were an unaccompanied youth who was
homeless or were self-supporting and at risk of
being homeless?
FAFSA Questions
• At any time on or after July 1, 2013, did the
director of a runaway or homeless youth basic
center or transitional living program
determine that you were an unaccompanied
youth who was homeless or were selfsupporting and at risk of being homeless?
Definitions
Definition of Terms
• Homeless—lacking fixed, regular, and adequate
housing, which includes living in shelters, motels, or
cars; or temporarily living with other people
because the student had nowhere else to go
• Unaccompanied—the student is not living in the
physical custody of a parent or guardian
• Youth—the student is 21 years of age or younger or
is still enrolled in high school as of the day the
FAFSA was signed
Caveats
A student is eligible for homeless youth status if
he/she meets the homeless definition and was
determined to be homeless by:
• A school district homeless liason
• A director of an emergency shelter program
funded by HUD
• The director (or designee) of a runaway or
homeless youth basic center or transitional
living program
Documentation
• Currently, the homeless questions are not
subject to verification
• If you question the student’s answers, you
may request documentation from:
– The school district homeless liaison
– Director of the shelter or transitional living center
Reporting Homeless Youth
Determination on FAFSA
• FAA Access to CPS Online
• Select “4 – FAA homeless youth determination” in the
Dependency Override field in FAA Application Entry or
FAA Correction Entry
• The Paper FAFSA
• Select new Homeless Youth Determination circle under
“College Use Only” section
• Electronic Data Exchange
• Enter a Dependency Override field value of “4”
Amy
• Amy ran away from home during her senior
year in high school because her father was
abusive
• Amy has always been able to stay with friends
Is Amy an unaccompanied homeless youth?
When Making a Determination
• Review dependency questions of FAFSA
• If student cannot answer “Yes” to any of the
questions, FAA must determine if student is
– An unaccompanied youth who is homeless
– Self-supporting and at risk of being homeless
When Making a Determination
• It is important that you examine students’
living situations and claims on a case-by-case
basis
• Use legal definitions to determine eligibility
When Making a Determination
Seek assistance
• Local school district homeless liaisons
• State homeless education coordinator
• National Center for Homeless Education
• serve.org/nche
• National Association for the Education of
Homeless Children and Youth (NAEHCY)
• naehcy.org
When Making a Determination
• Request documentation from recognized third
parties, examples include:
– Employer, mentor
– Counselor, clergy, social workers, doctors
– College access programs
– People with whom student may be staying
– Use discretion and respect student privacy
Resources
• Chapter 2 of the Application and Verification
Guide
• IRS Publication 17
• National Association for the Education of
Homeless Children and Youth
• naehcy.org/ legislation-and-policy/highereducation
• National Center for Homeless Education
• center.serve.org/nche/index.php
Conclusion
These dependency status questions are not only
confusing to us, they are confusing to our
students
Helping students get through the questions will
ensure each student gets the aid for which
he/she is eligible