FAFSA recognizes Unmarried and Same-sex Households

The U.S. Department of Education announced yesterday that beginning in 2014, students whose parents are unmarried but living together, as well as the children of married gay and lesbian couples, will be asked to list both parents when applying for federal financial aid.

Until now, the Free Application for Federal Student Aid (FAFSA) has collected financial information from only one parent if the parents were unmarried or in a same-sex marriage.

But starting with the 2014-15 form, FAFSA will collect information from parents living in a single household—regardless of marital status or gender.

The change is not expected to affect many families, but it could serve to reduce aid to some dependents of unmarried and same-sex couples because another parent’s income and assets will be consider in the calculation of need.

In fact, the Department of Education projects that in “most instances,” the amount of need-based Title IV federal aid these students receive will decrease because of the additional income and other resources used in the calculation of the student’s expected family contribution (EFC).

In other words, same-sex married couples who are currently barred from filing joint tax returns will be required to disclose total household income for purposes of computing financial need on FAFSA.

And couples who previously dodged disclosing a second household income by not marrying will be asked to provide a fuller accounting of their total resources.

"All students should be able to apply for federal student aid within a system that incorporates their unique family dynamics," said U.S. Secretary of Education Arne Duncan. "These changes will allow us to more precisely calculate federal student aid eligibility based on what a student's whole family is able to contribute and ensure taxpayer dollars are better targeted toward those students who have the most need, as well as provide an inclusive form that reflects the diversity of American families."

Toward this end, a new FAFSA form will use terms like “Parent 1 (father/mother/stepparent)” and Parent 2 (father/mother/stepparent) instead of gender-specific terms like “mother” and “father.”

The Department will publish these changes this week in the Federal Register for public comment as part of the draft 2014-15 FAFSA. 

Considering the impact the changes may have on some households, it’s likely the feds will get an earful.