Fed Financial

Will not claiming my 16 year old child on taxes help when he applies for college financial aid?

I'm worried about paying for my son's college and, with him being 16, there isn't much time to save. I've heard that if he hasn't been claimed on his parent's taxes as a dependent for 2 years prior to applying, he may qualify for a Pell grant and other financial aid. But I can't find anything in writing to support that. Should I not claim him this year?

Public Comments

1. I really am not sure, but I know there is a question on the free application for federal student aid (FAFSA) that asks something like "could you have been claimed on a parents taxes" What I am getting at is even though you dont claim him, you could have. I dont know what this even means, but I know that is one of the questions that they ask.
2. honestly i don't think it' will make any difference. I've had a lot of friends with this problem where their parents make to much to get enough student aid but not enough to actually be able to pay for college.. Since i'm assuming he still lives with you and I don't believe that not filling him would make a bit of difference for financial aid. go to the fafsa website in the nc, at least you must be married, have children, been 24 years old, be a ward of the state, be in grad school or be on active duty in the armed forces to be considered an independent. It's ridiculous I know but I've looked and looked for a way around it. at least now you know that you should start looking for a co-signer with good credit for your son so that you can take out loans. good luck
3. You will not find this in writing anywhere. There are two different "classifications" when applying for federal fin aid. Dependent; which requires the person to claim their parent and their income, and independent; which requires only the student and the students spouses (if they have one) income to be reported. Neither of these statuses has anything to do with who claims who on what tax form, where the student actually lives, weather the parent will pay for the kids education or even supports them or will continue to support them. Generally to be considered independent he has to be 24 years old, married, have kids he supports, be a veteran, an orphan, was a ward of the court until the age of 18 or have a bachelors degree. Claim him... honestly, it isn't going to make a difference.
4. Years ago and I mean years ago, that rule applied. It no longer exists and that is why you can't find anything. It would serve of no benefit to not to claim your son on your taxes for financial aid purposes. However, it would have a very negative impact on your income tax liability, so please claim him. The government offers many tax incentives to the parent who helps their child through college and this could help pay the college expenses. When you file your taxes this year as your tax professional about the financial benefits and tax incentives. You should take these into consideration and it will help your financial situation.
5. One thing that helps when you fill out the fafsa is that any money in your sons name is considered eligible to help pay for college. They say for example 50% of the money in his savings account is considered usable to pay for expenses. However only 20% (for example) of his parents savings is considered eligles to help pay for college. So my mom opened a separate savings account in her name and put all my savings in it since it is considered less % of contribution to college expenses. Hope this makes sense hard to explain in writing.