As you likely know, there have been considerable recent changes to the Free Application for Federal Student Aid that is affecting the millions of people who file the FAFSA each year.
I want to direct your attention to a wrinkle that wasn’t obvious when the FAFSA changes regarding divorce were rolled out. I don’t want you to miss it!
As you may already know, the rules on divorce have changed significantly. Before the 2024–2025 season, the parent with whom the child lived for the majority of a 12-month period, ending on the day the FAFSA was filed, was considered the custodial parent. Under the old rules, it was irrelevant if that parent provided the majority of support for the child.
The FAFSA makeover now requires the parent who provides the most financial support to be the custodial parent. Who is considered the custodial parent is important because it’s that parent who must submit the FAFSA. The non-custodial parent could have been earning seven figures a year and it would not have mattered because his/her financial information would not be shared.
The old way of settling a custody designation allowed parents to take advantage of income disparities between the ex-spouses. Let’s say the mom was a surgeon and the dad was a schoolteacher. To make sure the dad, the lower wage earner, filled out the FAFSA, the child simply had to live with the dad six months and a day.
With this calendar strategy eliminated, it sure seemed that the wealthier parent would no longer be able to escape the FAFSA’s attention. That’s because the parent who is better off would likely be providing more financial support and this would typically be evidenced by whoever claims the child on tax returns.
A way out?
But here’s what I wanted to bring to your attention: There currently is a way for parents to squirm out of this new FAFSA dictate. You see, the U.S. Department of Education is not verifying that the parent who is filing the FAFSA is actually the one who provides the majority of financial support. Consequently, the lower-earning parent can be the FAFSA filer without any apparent negative consequence.
This may raise eyebrows, however, if the custodial parent lives in a different state or a college also requires the CSS Profile, and the custodial parent is different on that financial aid application.
CSS Profile schools can decide what parents/stepparents they want to assess. Often Profile schools will assess the two original parents. Some schools, however, might assess the custodial parent and a spouse. Your client would need to ask each Profile school how they handle divorce.