FAFSA Simplification

On December 27, 2020, the Consolidated Appropriations Act, 2021 became law. In doing so, the legislation made a number of key changes to the FAFSA, the main application for college financial aid. These modifications were intended to simplify the financial aid process for students and their families, and make it easier for students to apply and qualify for federal student aid. The FAFSA changes were originally scheduled for the 2023-24 academic year, but now won't be fully in effect until the 2024-25 academic year. That means we won't see most of them on the FAFSA until the 2024-25 iteration of the form, which becomes available in December 2023. But it's helpful to understand what's coming, and how it will impact students applying for federal student aid in the future. 

Though the modifications to the FAFSA are numerous, we'll highlight some of the more notable ones here. The new law will:

• Reduce the number of questions on the FAFSA from a possible 108 to a maximum of 36.
• Make the FAFSA available in at least 11 languages.
• Remove the questions asking families to report the following untaxed income: cash support and any money paid on a student's behalf; child support; worker compensation; veterans' education benefits; housing, food, and other allowances for military and clergy; and other untaxed benefits.
• Change the treatment of families with more than one child in college; currently the financial aid formula gives a break to these families.
• Change the name of the Expected Family Contribution (EFC) to the Student Aid Index (SAI); many families mistakenly believe the EFC represents the amount that will appear on the college bill.
• Change the definition of the custodial parent (for families with divorced and separated parents) to the parent that provides the majority of the student's financial support (currently it falls to the parent whom the child lived with the most during the previous 12 months).
• Modify the income protection allowance (IPA) within the financial aid formula, which will result in protecting more parent and student income.
• Eliminate the questions that ask students about selective service registration and drug-related convictions while receiving aid.
• Add a new question on the FAFSA about the student's race or ethnicity.
• Prohibit charging a fee to complete the FAFSA.
• Allow families to import their income data directly from their tax returns to the FAFSA, to avoid the need to self report income data.

As the Department of Education provides more guidance on these important changes to the FAFSA, we'll continue to update you on our FAFSA Simplification Updates & Resources page and on our social media channels. If you're not doing so already, like us and follow us on Facebook, X (formerly Twitter), Instagram, and LinkedIn.

View our FAFSA Simplification Updates & Resources page