As college-bound students prepare for a new school year, they should be aware of a new date that's important for future financial aid: Oct. 1.
That's the new, earlier date after which students can file the FAFSA, or Free Application for Federal Student Aid. The infamous form is used to calculate how much students and their families must contribute to the cost of college, and how much help they will get in the form of grants, scholarships and loans. Students seeking financial aid must file the form, used by most states and colleges as the gateway to financial aid, each year.
In the past, students had to wait until Jan. 1 to file the form but was changed to align the financial aid process with the typical college admissions cycle.
The federal Education Department also changed the rules to allow students to complete the form using older financial information. Previously, the form that was available Jan. 1 used income from the tax year that had just ended. Students filing the form early this year, for instance, had to use 2015 income tax data. Financial advisers often urged students and families to file as soon as possible after Jan. 1, to maximize their chances of getting state grants, because some states have early financial aid deadlines.
That presented a problem, however, because most people do not have the necessary information, like wage statements, to file their tax returns in early January. Instead, they had to file FAFSA forms using estimated income data. The alternative was simply to file much later and risk missing out on aid.
The new rules have FAFSA filers use tax information from a year earlier — known, awkwardly, as "prior prior" year returns. (Students filing for the 2017-18 academic year, then, will use 2015 tax data.)
The main benefit of that change is that many more students can use the Internal Revenue Service's Data Retrieval Tool, which automatically fills in the online FAFSA form with the necessary tax information, said Lauren Asher, president of the Institute for College Access and Success.
Colleges are taking steps to notify students of the new date. Thomas M. Ratliff, associate vice president at Indiana Wesleyan University in Marion, Ind., said the university was sending e-mails to students who had indicated interest in attending, making them aware of the Oct. 1 date. A September meeting to make Indiana high school counselors aware of the change is also planned.
One question is whether colleges will change their own financial aid application deadlines. Some — particularly institutions with rolling admissions — are reportedly moving up their "priority" financial aid application deadlines to November or December. That could put students in a time crunch in the fall.
"At some institutions, if you miss the priority deadline, there may be little to no aid after," said Carrie Warick of the National College Access Network.
The network is urging colleges to set their aid application deadlines no earlier than Feb. 1.
Still, the Education Department is advising counselors to tell families to double-check their state and school financial aid deadlines. Parents, the department notes on its website, should "make sure that your child's school and state deadlines have not changed, and plan accordingly."
Ann Carrns writes for the New York Times.
