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Rental real estate, royalties, partnerships, S corporations, trusts, etc.Taxable refunds, credits, or offsets of state and local income taxes.Ignoring the six exceptions, Schedule 1 is required if the taxpayer is reporting additional income or an adjustment to income. The reason for the focus on Schedule 1 is to prevent taxpayers from manipulating their income to qualify for Auto-Zero EFC or the Simplified Needs Test. If IRS Form 1040 Schedule 1 is required, the applicant is not eligible for Auto-Zero EFC and the Simplified Needs Test. Department of Education decided to base eligibility on IRS Form 1040 Schedule 1 instead of IRS Forms 1040A and 1040EZ. This affected all FAFSAs through and including the 2019-2020 FAFSA.īut, IRS Forms 1040A and 1040EZ were eliminated in 2018. In 2017 and earlier years, independent students and parents of dependent students could qualify for the Auto-Zero EFC and the Simplified Needs Test by being eligible to file IRS Form 1040A or IRS Form 1040EZ. The Simplified Needs Test disregards all assets on the FAFSA.
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Auto-Zero EFC sets the expected family contribution (EFC) to zero on the FAFSA. The change in federal income tax forms affects eligibility for Auto-Zero EFC and the Simplified Needs Test.Īuto-Zero EFC and the Simplified Needs Test are simplified versions of the federal financial aid formula. Auto-Zero EFC and the Simplified Needs Test The 2018 federal income tax returns replaced IRS Forms 1040A and 1040EZ with a set of schedules to IRS Form 1040. The 2020-2021 FAFSA, which families begin filing on October 1, 2019, is based on 2018 federal income tax returns, using income and tax information from the prior-prior year.
#FORMS TO GO WITH 1040A FREE#
Recent changes in federal income tax returns affect the Free Application for Federal Student Aid (FAFSA), starting with the 2020-2021 FAFSA.