FAFSA Income and Asset Reporting 1

Question 1

Which income is reported on the FAFSA as untaxed income?

Accepted Answer

Child support received

Answer

Child support received is reported as untaxed income on the FAFSA and is counted toward the household's financial resources.

Question 2

How are 529 college savings plans owned by a parent reported on the FAFSA?

Accepted Answer

As parent assets

Answer

A 529 plan owned by a parent is reported as a parent asset on the FAFSA and is assessed at a lower rate than student assets.

Question 3

Which of the following is considered a student asset on the FAFSA?

Accepted Answer

A savings account in the student's name

Answer

A savings or checking account in the student's name is considered a student asset and is assessed at 20% in the SAI formula.

Question 4

Social Security benefits received by the student or parents are reported as:

Accepted Answer

Untaxed income if not included in AGI

Answer

Social Security benefits that were not included in the adjusted gross income are reported as untaxed income on the FAFSA.

Question 5

What is the FAFSA treatment of a student's Uniform Gift to Minors Act (UGMA) or Uniform Transfer to Minors Act (UTMA) account?

Accepted Answer

Student asset assessed at 20%

Answer

UGMA/UTMA accounts in the student's name are reported as student assets on the FAFSA and assessed at the higher 20% rate.

FAFSA Practice Test