Changes to FAFSA will allow families to file as early as October

The White House is announcing today that starting in 2016, students will be able to file their Free Application for Federal Student Aid (FAFSA) as early as October.  Under the old rules (applying to this year's seniors), students had to wait until after January 1 to submit the paperwork necessary to determining their eligibility for federal support.  By implementing this change, the White House hopes to increase the number of students receiving aid and encourage more young people to pursue postsecondary education.

For purposes of filing early, applicants will be able to use “prior-prior-year” tax data, which federal officials say will help students determine the true cost of attending college much earlier in the process.  Those students filing electronically will also be able to immediately take advantage of a relatively new FAFSA tool designed to facilitate retrieval of tax information and pre-populate it on the FAFSA form.

Using older tax information, however, could cause some inconveniences for colleges relying on financial data that could change significantly in a year to determine aid packages.  But this is not a new problem, as early filers have frequently been required to provide up-dated or amended information later in the process.  The point has always been to file as early as possible to ensure an early read on financial aid eligibility and that has sometimes meant using estimates based on prior-prior-year tax data.

“We anticipate there may be a little more work for colleges to do to adjust their financial aid packages,” James Kvaal, deputy director of the White House’s Domestic Policy Council, told the Associated Press. “But overall, we believe that the earlier tax data is a sound basis for awarding federal student aid.”

The change in filing timelines should also enable many financial aid offices to get an earlier fix on potential demands on their financial aid resources.  For the nearly 400 colleges and scholarship programs requiring the CSS PROFILE to determine eligibility, this could be a welcome development, as the PROFILE also becomes available for completion in October.  Having both documents to work with should enable those colleges to get a fuller picture of a family’s financial situation earlier in the game.  Regardless, there will no longer be an excuse for delaying financial aid packages for students admitted under early action (EA) or early decision (ED) plans if the FAFSA is filed before the first of the year. 

The challenge that remains is getting the word out to families potentially benefiting most from the earlier availability of the FAFSA and providing them with the kinds of support needed to get the paperwork started before the end of the year.  Many of the organizations that have lobbied for this change are the ones most active in helping students and families complete the FAFSA through free workshops and other programs.  Hopefully, they too will move their timelines up by a few months.

With other proposed changes, including the removal of requirements to share college lists on the FAFSA, the Obama administration appears to be making good on promises to reform the federal financial aid process and reach out to students who may have missed opportunities in the past.