FAFSA simplification 2024-25
Due to the passing of the FAFSA Simplification Act enacted by congress, Federal Student Aid is rolling out significant changes to the 2024-25 FAFSA. See more about the changes on the Department of Education site: FAFSA Simplification Act.
Highlights
- Shorter application: 36 questions instead of 100+
- Expanded eligibility, including expanded access to the Pell Grant
- Application available in 11 most common languages spoken by English learners
Who is a contributor?
Contributor is a new term introduced in 2024. It refers to anyone asked to provide information on a student’s FAFSA:
- the student
- the student’s spouse
- a biological or adopted parent
- the parent’s spouse (stepparent)
Changes to the application
- FSA accounts for all contributors: contributors now use an FSA ID to complete the FAFSA. In the past, the ability to create an FSA ID was limited to users with social security numbers. Now, all users can create accounts to access the FAFSA.
- Divorced parent income: income is reported by the parent who provides the most financial support rather than the parent the student lives with.
- Demographic questions: a survey has been added with questions related to race, ethnicity, and gender. The survey has no effect on eligibility and is used only for statistical purposes.
- Improved process for importing tax info: contributors now securely transfer their tax information directly from the IRS. The new process uses the Direct Data Exchange (DDX) and eliminates the confusing step of connecting to the IRS Data Retrieval Tool.
- Consent for importing tax info: contributors are prompted for consent for the IRS to share their tax info with the FAFSA.
- Selective service: students no longer need to register for selective service to qualify for aid.
- Drug convictions: eligibility limits related to drug convictions have been eliminated.
- SAR name change: the Student Aid Report (SAR) is now the FAFSA Submission Summary (FSS).
- More colleges: students can now send their FAFSA to up to 20 schools.
New formula
- New: Student Aid Index (SAI)
- Old: Expected Family Contribution (EFC)
Changes to eligibility calculations
SAI, or Student Aid Index, is replacing the EFC, or Expected Family Contribution. Like the EFC, the SAI is a measure of a student’s ability to pay for college and is used to determine eligibility for need-based aid.
Formula for calculating SAI:
Parent contribution plus Student contribution from income plus Student contribution from assets equals SAI
Formula for calculating student need:
COA (cost of attendance) minus SAI (student aid index) minus OFA (other financial assistance) equals Student need
Changes in the new formula
- Negative SAI: a student’s SAI can be negative, with a minimum of -$1500 instead of zero.
- Child support: child support received now counts as an asset instead of income.
- Small businesses and family farms: families with small businesses or farms now need to include the value of those businesses as an asset, even if they have fewer than 100 employees. The value of a family’s primary residence is still excluded.
- Number of family members in college: the number of students a family has in college is no longer a factor in the SAI calculation.
- Provisional independent status: foster, homeless, and unaccompanied youth, as well as applicants who cannot provide parental information, can complete the form with a provisional independent student determination.
- Untaxed income: untaxed items such as payments to tax-deferred retirement or pension plans, veteran’s non-educational benefits, and worker’s compensation will no longer be required.
- Pell eligibility: the new formula implements separate eligibility criteria for Pell Grants. Pell Grant eligibility is now linked to family size and the federal poverty level.