How Divorce Affects Your Child’s Financial Aid for College

When obtaining a divorce, determining child support is often one of the parties’ top priorities. Unfortunately, not all parents consider splitting the responsibility of the cost of college at the time of their divorce, especially if their children are very young at the time.
Divorce can complicate obtaining financial aid for your child’s college education and disputes about each parent’s financial responsibility are common. But, by following some simple tips about preparing your child’s FAFSA and including a college support plan in your divorce agreement, obtaining financial aid and covering college costs can be made much simpler.

Free Application for Federal Student Aid (FAFSA)

If your child needs financial aid for college, the government supplies a Free Application for Federal Student Aid, or FAFSA, to help determine their eligibility. Typically, both parents report their income, household size, number of children in college, and other information so that the government can calculate what their ability to pay for their child’s education is; the child will then be given different financial aid options available to them based on the information provided.
However, as stated earlier, a divorce can make filling out the FAFSA form tricky. It can be difficult to know which parent’s income and assets should be provided in which instances and when the information for both parents is required instead of that of just the custodial parent.
Below, we take a look at the unique way the FAFSA form defines “custodial parent,” a standard list of information about the custodial parent, the non-custodial parent and the child that will need to be included with the application, and information on how you can establish in advance how the remaining cost of college will be divided between the parents.

Who is the custodial parent for the FAFSA?

The FAFSA requires that the custodial parent provide their information to determine eligibility. The application uses the term “custodial parent”; unlike having legal custody of your child, being a custodial parent simply means that either:
• The child has lived with you the most in the last 12 months; or
• If the child has lived with both parents equally, you have provided the most financial support to the child in the past 12 months
The custodial parent is the only parent required to report their income and other information on the FAFSA, unless the custodial parent has remarried: both the custodial parent and step-parent in that situation would have to report.

What information does the custodial parent need to include in the FAFSA?

Once you have determined who the custodial parent is, the next step is to gather a variety of information that the U.S. Department of Education will use in their eligibility calculations. Note that, even though the non-custodial parent doesn’t need to report their earnings they still must provide other information on the application.
A standard list of information a custodial parent and their child will need to provide includes:
• The child’s Social Security Number or alien registration number
• The Social Security Number or alien registration number of both parents
• The federal tax information for the child and the custodial parent
• The child’s driver license number
• Information on the custodial parent’s other assets such as cash and liquid assets in accounts, investments, and business income
• Information about the divorce (some schools may require a copy of the divorce decree to be provided as well)
• Information about any untaxed income—like child support—that the custodial parent may have received
• Details regarding any alimony payments (if the alimony received is taxable income, this will already be in included in the custodial parent’s tax information)
Once your application is completed and submitted, you will receive a Student Aid Report (SAR) informing you of your child’s eligibility for financial aid based on the information you provided. If you completed the application online, you should receive your SAR in as little as 3-5 days.
Unfortunately, divorced parents have yet another hurdle: determining how much each parent is going to contribute to the total cost of their child’s college. In many cases, divorced parents can feel like they are going through their divorce all over again as oftentimes there are disagreements as to each party’s financial responsibility.

How divorce mediation can help with your child’s college tuition

If you’re a divorcing parent, an easy way to establish in advance how much each parent will contribute to your child’s college costs is to include a college support plan in your divorce settlement. A qualified mediator, like the experienced team at Divorce Mediation Professionals, can help you and your spouse negotiate a cost allocation that works for both parties and their unique situations. For more information on how we can help make paying for your child’s college costs easier by setting up a college support plan, contact us today for a consultation.

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