A series about college financial aid for parents of high school students.

I have heard so much about how income levels relate to completing the FAFSA®. Our friends are considering reporting that their child lives with a grandparent or an older relative who earns less money so they will qualify for more financial aid. Should we think about doing the same thing?

No – you should never lie or falsify the information you include on the Free Application for Federal Student Aid (FAFSA). Doing so can result in the loss of financial aid. The Department of Education has very specific guidelines as to whether a student is dependent or independent and who is considered a parent or guardian when it comes to determining federal student aid eligibility.

What is dependency status?

Dependency status determines whose financial information will be reported on the FAFSA. You must follow FAFSA guidelines to determine whether a student is dependent or independent.

What is the difference between a dependent and independent student?

Dependent students report both their financial information and their parents’ when completing the FAFSA. Independent students report their own financial information, including a spouse and any dependents.

Why does dependency status matter?

Dependency status helps determine the amount of financial support a student might receive in paying for college. It is assumed the family can help a dependent student, but that decision is based strictly on the financial information provided. An independent student may qualify for additional financial aid, depending on the individual situation.

How do I determine whether I am dependent or independent?

The FAFSA takes applicants through a series of questions including:

  • Are you married?
  • Are you working on a graduate or doctoral degree?
  • Are you on active duty or a veteran of military service?
  • Do you have children or dependents?
  • Are your parents deceased, have you been emancipated or are you a ward of the court?
  • Are you homeless?

Most undergraduate students will answer No to these questions and will therefore be required to report their information as well as their parents.

Why can’t we just say our student lives with someone else?

Even if your child does live with someone else and is not claimed by you on tax forms, that still does not qualify as being an independent student for federal student aid purposes. Unless your child has been legally adopted by somebody else, your financial information will be used.

Who can be considered parents?

Birth parents, adoptive parents and legal guardians are considered parents, including those of the same sex. If the parents are not married but live together, financial information must be reported for both. For unmarried parents who do not live together, you must determine which of the two the student spent the most time with over the course of the year preceding the completion of the FAFSA.

It can get a little complicated with today’s living situations, but honesty is always the best policy when completing the FAFSA to ensure the student has access to federal student aid. If you have questions or are unsure how to complete the FAFSA, then you should talk to the school’s financial aid office for assistance.


About the Author

Jodi Okun is founder and president of College Financial Aid Advisors and a Discover Student Loans brand ambassador. Visit her website at collegefinancialaidadvisors.com. She is also the About.com Money Expert on “Paying for College,” and was recently acknowledged as one of the “Top 30 Social Influencers in Personal Finance & Wealth.” She has been featured in The Wall Street Journal, Mashable, US News & Education and The Huffington Post. The opinions expressed in this article are Jodi’s and do not necessarily reflect the opinions of Discover Student Loans.

FAFSA is a registered service mark of the U.S. Department of Education.