In May, Education Secretary Arne Duncan alerted financial aid administrators that they should make students, parents, and families more aware of options for increased financial aid due to loss of job and income using the professional judgement override system. For consumers, asking for a professional judgement override on future earnings and income, along with proper documentation (tax returns denoting previous income, termination notice, and unemployment benefits paperwork) will allow families to ask for reconsideration of financial aid.
In recent professional judgements, additional help is being given by financial aid administrators by implementing guidance from the Department of Education that says unemployment benefits should also be discounted in financial aid appeals. This means that for families where unemployment benefits are the only source of sustenance income, financial aid will not be eating into your unemployment insurance.
If you’ve faced job losses recently, make sure you contact your school’s financial aid office to potentially appeal for more financial aid, and when you complete your 2010-2011 FAFSA, be sure you do NOT include unemployment benefits as additional income on your FAFSA.
“The chairman of the House Education Committee has dismissed a last-ditch plea from the private student loan industry and is throwing his support behind President Obama’s plan to end the role of private banks in the federal education lending systems,” The New York Times reports. “Mr. Obama’s plan remains deeply contentious in Congress, and still faces strong opposition from private banks that for decades have earned big profits for handling federal student loans. But after mulling the issue for months, Representative George Miller, the California Democrat who is chairman of the Education Committee, now plans to introduce legislation next week that would rely on direct government lending to replace the federally subsidized loans made by private banks. Administration officials who have reviewed drafts of the legislation said that it substantially adopts Mr. Obama’s proposal.”
“Student Loan Corp. (STU) is feeling a little lonely these days – and that could devastate its business,” The Wall Street Journal reports. “The company, a subsidiary of Citigroup Inc.’s Citibank N.A., was the only publicly traded dedicated student lender not chosen last month for the government loan-servicing contracts analysts say could help save the industry. Student Loan wasn’t even picked as a finalist. A source familiar with the contracts said servicing capacity was a major consideration in choosing the final four recipients.”
Until I began doing research for this blog I honestly had no idea such a service existed. A credit bank to deposit your education credits, what a novel idea. It is ideal for anyone with a complicated educational history.
For someone like me who attended a community college before continuing on to a state school it is not really necessary. But for someone who has attended several different universities and colleges, taken some company sponsored seminars, and has had a number of informal learning experiences consolidating your academic records may be worthwhile.
The Excelsior College Credit Bank is an evaluation and transcript service for people who wish to consolidate their academic records, perhaps adding credit for nonacademic career and learning experiences. All education is then listed on a widely accepted transcript to be submitted were directed. There is a $200 set up fee and a $25 deposit fee each time you make a new education deposit.
According to socialsecurity.gov if you are a blind or disabled child who is regularly attending college, or a course of vocational or technical training, you have limited earnings potential that is not counted against your Supplemental Security Income (SSI) benefits. In fact, the maximum amount increased for 2009.
Income Exclusion Amounts for 2009 For 2009, the student earned income exclusion amount is $1,640 per month, and $6,600 for the year. That’s up 5.8% from 2008.
There are some changes that will occur for this upcoming 2009-2010 school year that will effect any student that receives some sort of Federal aid. These changes are due to the 2009 Economic Stimulus bill. Here is a breakdown of the changes and what it means for you and your financial aid:
Pell Grant increases:Â The maximum annual amount for Pell Grants (free scholarships for lower-income students) increases from $4,731 to $5,350 in 2009. Congress is considering President Obama’s proposal to further boost the maximum to $5,500 next year.
Pell Grants needn’t be repaid and can be used for tuition, books and living expenses while enrolled at a participating institution. To apply, you’ll need to complete the Free Application for Federal Student Aid (FAFSA) form at www.fafsa.ed.gov. Note that the federal deadline for FAFSA submission for the 2009-2010 school year is June 30, 2009.
New tax credit: The Hope Scholarship, an educational tax credit that reduces a student’s or family’s tax liability, is being replaced in 2009 and 2010 by the more robust American Opportunity Tax Credit. Enhancements include:
* Maximum credit amount increases from $1,800 to $2,500.
* Tax credits can now be claimed for all four years of college, instead of only the first two.
* Those with an adjusted gross income (AGI) of less than $80,000 ($160,000 for joint tax filers) qualify for the full credit – a significant increase over previous years. The credit gradually phases out for AGI between $80,000 and $90,000 ($160,000 to $180,000 for joint filers).
* Unlike Hope Scholarships, this credit is partially refundable, which means lower-income families paying for college can receive a refund of up to 40 percent, even if they owe no federal income tax.
Federal Work Study Program expansion: About $200 million has been added to this program, which provides on-campus part-time jobs to students. Eligibility is determined by information provided in the FAFSA.
Financing computers: Tax-free withdrawals from 529 College Savings Plans are now allowed for computers, in addition to tuition, room and board, and books.
Federal Stafford loans: An additional $2000 in the unsubsidized loans will be available for dependent students. Also, the interest rate for subsidized loans will decrease from 6.0% to 5.6% after July 1, 2009.
So with all these additions to the Pell grant, Stafford loans, work study etc…it seems like a lot of people should be seeing more aid in their award letters for the 2009-2010 school year. If you receive more financial aid, what will that mean for you? How will it help you personally? Leave a comment, share with me, and happy Friday:)
**For Scholarship Points members enter the code STIMULUS2009 to collect your points!
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Five most recent FAFSA form help blog posts:
I’ve heard from countless students who’ve cried foul over the fact they can not get aid for school, but the best part was when they revealed to me that they did not even bother to complete their FAFSA. They had already come to the conclusion they would not be eligible because a couple of their buddies weren’t. I was just left scratching my head.
In 2007 alone, 16,000 eligible Massachusetts students failed to complete the FAFSA effectively leaving $59 million in federal aid on the table. I can’t urge you enough to complete the FAFSA. You can’t get a dime if you don’t complete that form. If nothing else you can at least take out a federal loan.
I love the Bay State and I love the Red Sox (first pitch of the ‘09 season is in 10 minutes), but I don’t love hearing that millions of dollars are going to waste that could help ease the cost of higher education for so many.
The Free Application for Federal Student Aid form has gotten a lot of media attention lately regarding needed improvements, but it’s not reasonable to expect any government program to run efficiently.
The university’s director of financial aid, Michael Scott, said in a Skiff article Tuesday this week that there were problems with the length, redundancy and inefficiency of the FAFSA system.
When I first read this story, I thought, “Whoa, we have an administrator named Michael Scott? How cool is that?”
The second thing that came to my mind was that even though students and financial officers have said that we need to make changes to the FAFSA to make it more efficient, the truth is that it’s never going to happen.
First, I point to other government things that are inefficient. Tax return forms, traffic, our public school system, the post office, the Department of Motor Vehicles and countless other things. Almost anything the government touches, seems to become unbearably inefficient. We should not be surprised that the FAFSA follows the exact same route.
Second, the government has no incentive to make these programs better. Sure, we could vote the people in charge out but we have done that for decades now and nothing seems to change.
My parents have as many waiting-in-line stories as I do about the DMV. The FAFSA may be improved for a while but then it will get out of date again and people will begin to have more complaints.
It’s great that the government provides this service to campuses around the nation to determine how much a student’s family can contribute. Something can also be said for the fact that it helps some families pay for college. However, I do not believe most people are getting a good deal with the FAFSA.
My family’s income hinders me from getting scholarships, but what the FAFSA fails to consider is that I have a disabled brother who requires a lot of medical attention. I am sure other students are in a situation like this as well. It’s insane that the government gets to decide who is more worthy to get money to go to school simply based on a few numbers.
Government is a good resource when it serves its intended purpose of protecting citizens’ rights to life, liberty and the pursuit of happiness like the Founding Fathers thought it should. It’s only when government tries to force its happiness on us that things really get messed up.
Let’s stop looking at ways that we could fix government and government documents and re-evaluate whether we need government to provide these services at all.
Michael Lauck is a freshman broadcast journalism major from Houston.
It seems that students who live in West Virginia may have some additional help in filling out the FAFSA form. Check out the article below from West Virginia Public Broadcasting.org. Can other states get in on this
Turbo Tax, Marshall Team up to provide FAFSA Help
By Clark Davis of West Virginia Public Broadcasting
March 26, 2009 · Intuit, the makers of Turbo Tax software, has developed a new product for West Virginia customers called Turbo Tax FAFSA.
Students and parents often dread filling out the Free Application for Federal Student Aid form each year. The form contains more than 100 questions that have to be answered before a student can apply for financial aid.
Now, through the cooperation of Marshall University and the makers of Turbo Tax, there may be an easier way.
Last fall, Marshall University President Stephen Kopp approached Intuit’s CEO and Marshall Alum Brad Smith about developing a program that would help students fill out the federal financial aid form
Chris Womack is a product manager at Intuit and helped develop the Turbo Tax FAFSA program.
“The key value that we have in this first product launch this year is the ability to take data directly from your TurboTax product, so students and parents will go and complete their taxes using either one of our free or paid offerings,†Womack said.
“They will complete their taxes like they normally would and when they get to the end of it they can automatically transfer over all of that data from TurboTax into our new product TurboTax FAFSA. Depending on the situation up to 50 or 60 percent of the data required on the financial aid form comes directly from the tax return.â€
Womack says they realized the importance of making it easier for students to apply for financial aid in today’s economy.
“Especially in an economy this year where lots of people find themselves needing more help and in general there are more people trying to go to school,†Womack said.
“All that kind of comes together into a climate where it’s really important to get as many people into getting financial aid applications done quickly and easily and early so they have the best opportunity at getting the financial aid.â€
Wayne High School counselor Lynnetta Welker thinks the program will make it easier for students and their parents to fill out the federal financial aid form.
“We have families that don’t want to deal with the paperwork and lot of times the student themselves will come to me and they’ll say my mom and dad won’t do this for me will you help me,†Welker said. “And we do and if the child has trouble getting the tax information and we’ve had trouble with that in the past, maybe if there parents think no one else will see it and it’ll just transfer it will make it easier because I’ve had parents that they don’t want anyone else to see their tax information.â€
And Welker sees this as an opportunity for students who might not go to school without the help of finical aid.
“With any luck will have more students fill out the FAFSA in order to get the money so they will go on to school,†Welker said. “A lot of them just think they don’t have any hope of having the financial stability to go to school and this way they will. I think it’s going to be a great help, even this year alone with the online FAFSA students have filled out a lot more and we’re sending a lot more to college this year. It’s really going to make a big difference.â€
The program is only available for West Virginia residents when they submit their taxes online using Turbo Tax; however, the company may make the program available nationwide if it does well in West Virginia.
receives some sort of Federal aid. These changes are due to the 2009 Economic Stimulus bill. Here is a breakdown of the changes and what it means for you and your 
