2014 Annual Statewide Financial Aid Conference for High School Counselors

1. 2014Annual Statewide Financial Aid Conference for High School Counselors • November 6, 2014

2. Application Process & FAFSA

3. Free Application for Federal Student Aid - FAFSA • Apply on-line at: www.fafsa.gov(not .com!) • 2015-2016 FAFSA available January 1, 2015 • The earlier, the better (for some types of aid) • Check colleges’ web sites for priority deadlines • Can complete with estimated tax figures and make corrections later • Carleton, Macalester, St. Olaf, Gustavus Adolphus (and many east coast colleges) require CSS Profile form in addition to FAFSA • https://profileonline.collegeboard.com

4. FAFSA on the Web (FOTW) www.fafsa.gov • Apply • Retrieve IRS data • Reapply • Apply for PIN • Find college codes • Check status of FAFSA • Make corrections • Add additional colleges • Print SARs

5. 2015-2016 FAFSA Changes #5 • Draft in packet • No significant changes made to 2015-2016 FAFSA! • Paper FAFSA colors yellow and purple • Minor changes to instructions • Biggest changes effective 2014-2015 • Reporting information for both of student’s legal unmarried parents if they are living together • Reporting information for both legal parents or student and spouse in cases of same-sex marriage • Discuss handout #8

6. 2015-2016 FAFSA Changes • Thousands of 2014-2015 FAFSA applications were reprocessed due to reporting error • Students/parents erroneously reported cents in fields for earnings from employment • No cents should be reported on FAFSA • Overinflated earnings • $31,567.68 went through as $3,156,768 • For tax filers, increased the FICA offset against wages in the EFC formula, resulting in lower EFCs and more federal aid • For non-filers, increased both the income and offsets, resulting in higher EFCs and less federal aid

7. 2015-2016 FAFSA Changes • FAFSA on the Web modified in July 2014 to address this problem • All financial fields will now be right-justified so errors more apparent to applicants • If student enters a decimal point and cents, system will ignore/delete decimal point and following digits

8. 2015-2016 FAFSA Changes • Spring 2015, new Federal Student Aid (FSA) ID will replace PIN numbers • FSA ID will be user-selected username and password • Used for all federal student aid web sites, including FAFSA on the Web • Single sign-on process to access these web sites • Both students and parents will have a FSA ID • Will eliminate need for students/parents to enter SSN, name, DOB when logging in • More information to come!

9. FAFSA on the WebIRS Data Retrieval • If applicant indicates filed taxes on FOTW, will be prompted to use IRS data interface • If chooses not to use IRS interface will be subject to selection for verification • IRS data available: • 2 to 3 weeks after federal tax forms filed electronically (70% of filers) • 8 to 11 weeks after paper federal tax forms filed (some have experienced longer delays) • If there is unpaid tax obligation to IRS, tax returns won’t be processed until May or June 2015

10. FAFSA on the Web IRS Data Retrieval • IRS data retrieval can be used: • While completing original FOTW • As a later correction to FOTW • Applicants will receive automatic reminder emails to go back to FOTW and use IRS data retrieval if: • They provided estimated tax figures on the FOTW • Provided actual tax figures on FOTW but did not use IRS data retrieval

11. FAFSA on the Web IRS Data Retrieval PROBLEM: • Students/parents pull in IRS tax information as a correction to the FAFSA on the Web and forget to actually sign/submit the correction SOLUTION: (for 2015-2016) • Users will get message prompting submission of correction after they use IRS data retrieval • System will send email to student if saved correction not submitted within seven days of inactivity

12. Items Populated on FOTW from IRS Data Retrieval • Adjusted gross income • U.S. income taxes paid • Untaxed IRA distributions, pensions • Education credits • IRA deductions • Tax exempt interest • Student’s and parents’ income from work if: • Marital status is other than married • If ‘married’, total income from work from tax form will appear on screen and will need to separated by student or parent for entry into FOTW fields

13. FAFSA on the Web IRS Data Retrieval • Who CAN’T use IRS data retrieval: • Married couples who filed separate tax returns • Married couples if one filed as head of household • Student’s legal parents are unmarried and living together • Filed an amended return (must submit original 1040 and 1040x to school) • Filed Puerto Rican or foreign tax return • Filed tax return too recently • Applicants whose marital status changed since January 1 of the processing year

14. FAFSA on the Web IRS Data Retrieval • If family can’t use IRS Data Retrieval, will need to produce official IRS tax return transcript if selected for verification • On-line request at: http://www.irs.gov/Individuals/Order-a-Transcript • Must type in SSN, name and address exactly as it appears on tax return • Can look up zip code at: www.usps.com to get exact street address • Touch-tone phone request at: • 1 (800) 908-9946

15. Criteria for Independent Applicant • At least 24 years old by December 31st of the award year covered by the FAFSA • Graduate or professional student • Married (does NOT include cultural marriage) • Has legal dependents other than a spouse who receive more than one half of their support from the student during school year • Any time since turning 13 was/is an orphan, in foster care, or ward of the court • On active duty or veteran of the U.S. Armed Forces • Emancipated minor or in legal guardianship as determined by a court (by someone other than parent) • Unaccompanied homeless youth as documented by: • (high school/district homeless liaison, authorized shelter administrator, financial aid administrator interview)

16. Other FAFSA Handouts for Students • Tips for Completing the 2015-2016 FAFSA • Completing the FAFSA: Special Guidance Related to Dependency Status and Providing Parental Information • The FAFSA: Why, When and Then What? #6 #7 #23

17. FAFSA Training • More detailed FAFSA training for new counselors offered at this workshop following presentation and Q & A • Also, FAFSA line-by-line training offered to professionals working with students by • www.minnesotacollegegoal.org

18. FAFSA Results • Student notified of FAFSA processing results by: • E-mail notification with link to student’s SAR online if student’s e-mail address provided: • FAFSA on the Web (takes 1-2 days if electronically signed with PIN; 2 weeks if mailed in signature page) • Make sure student adds federal email address to address book to avoid delivery problems FederalStudentAidFAFSA@cpsemail.ed.gov • If student has a PIN, can view SAR online at www.fafsa.govand make corrections

19. If Selected for Verification • Verification items tailored to each student and indicated on SAR/ISIR • Some students may need to verify all items; others not • If items limited to data from tax return, verification can be accomplished through IRS data retrieval process alone • If verification items include both tax return and other items, then verification worksheet or other documentation must also be completed

20. Professional Judgment • Normally, a family’s Expected Family Contribution (EFC) is based on income for the previous tax year • For 2015-2016 academic year, tax year 2014 • Financial aid administrators can use their “professional judgment” to alter data on the FAFSA for special circumstances (e.g., unemployment) • Adjustments are typically performed as corrections by the financial aid office after the original FAFSA is submitted and verified

21. Professional Judgment • Common examples include: • Significant change in income from past tax year based on unemployment, underemployment, death, divorce, military service or natural disaster • Unusually high medical expenses • Nursing home expenses • Elementary or secondary school tuition paid • Significant college costs for dependent student’s parent attending college • Dependency override • Family should contact financial aid administrator to discuss unusual circumstances

22. What is a Dependency Override? • Gives financial aid administrator authority to allow otherwise dependent applicant to apply as independent applicant due to unusual circumstances • Parental abuse, abandonment, incarceration, etc. • Not used simply because student lives outside parent household after age 18 or parents object to providing data • Must be supported by documentation, preferably by someone outside immediate family • Student should contact financial aid office for instructions after submitting FOTW without parental data

23. Completing FAFSA Without Parental Information • For students who don’t qualify for a dependency override but can’t provide parental information: • Will have the option to submit the FAFSA for an unsubsidized loan only • FAFSA on the Web will present a path that allows the applicant to indicate that he or she will not provide parental data on the form and will allow the applicant to submit the FAFSA • School will later require statement from one parent that parents refuse to complete the FAFSA and do/will not provide financial support to the student

24. Award Notification • Student should receive award notice from each college listed on the FAFSA once admitted to college • Important that student identifiers on FAFSA match identifiers used in admissions process • Financial aid varies depending on the cost and mix/composition of financial aid available • Compare net costs after grants and scholarships • Use net calculator on college’s web site or nces.ed.gov/collegenavigator • Some campuses may use Financial Aid Shopping Sheet #18

25. Consumer Financial Protection Bureau • Has tool students can use to compare costs and financial aid award offers for up to three colleges • Will also show students what student debt and repayments may look like at each college #19

26. Sources of Financial Aid

27. Federal Methodology EFC Calculation #9

28. Cost of Attendance • Tuition and fees • Room and board • Books, supplies and equipment • Transportation • Personal expenses • Typically, COA = T&F + $10,000 to $15,000

29. Packaging Financial Aid • In general, need-based financial aid cannot exceed cost of attendance minus EFC • Remaining need after grants and scholarships typically covered by work-study or loans • Some forms of financial aid can replace all or portion of EFC (Unsubsidized Stafford Loan, PLUS Loan, certain private scholarships, etc.)

30. Limits on Financial Aid • Satisfactory Academic Progress • Finish program within 150% of program length • E.g., 6 academic years for 4-year program • State Grant only available until student attends college for 4 FT academic years • PSEO courses not counted • Student can only receive Pell Grant for 6 FT academic years (or equivalent) • Subsidized Direct Loans only available for 150% of program length Handout – The Sooner the Better #11

31. Federal Grants & Scholarships *Pell Grant maximum for 2015-2016 not yet established

32. State Grants & Scholarships(for MN residents attending college in MN)Check out Handout #10 for Pell & State Grant Look-Up Chart! #10

33. #15 MN Dream Act • MN Dream Act signed into law May 2013 • Qualifying undocumented students now eligible: • In-state tuition rates at MnSCU and U of M • State financial aid programs • Private scholarships administered by MnSCU/UM • To meet MN Dream Act requirements: • Attend MN high school for at least 3 years • Graduate from a MN high school or earn MN GED • Comply with Selective Service requirements • Males 18 to 25 years old must register • Apply for lawful immigration status once a federal process for doing so exists (not yet applicable)

34. MN Dream Act Online State Financial Aid Application • Cannot apply using FAFSA • Link to online MN Dream Act state financial aid application and instructions posted on: • www.ohe.state.mn.us/MNDreamAct • OHE contracted with Need Access for 2014-2015 MN Dream Act application • Paid application fees on behalf of applicants • OHE building its own 2015-2016 MN Dream Act application • Will be more like FAFSA on the Web • English and Spanish • Easier for students to understand • Please get the word out to your undocumented students

35. After Using MN Dream ActOnline State Application • Students will receive email confirming they have used the MN Dream Act online application • Email will instruct student to send the following documentation to OHE: • MN high school transcripts showing at least 3 years attendance (don’t need to be official) • MN high school diploma or GED (if transcripts lack grad date) • Selective Service registration confirmation • College transcripts (if student has attended college for 3 or more academic years) • Signed federal income tax forms (filers) or W2s and signed statement (non-filers) for verification of financial information

36. Institutional Scholarships • Many of these listed in central location on OHE website: • http://www.ohe.state.mn.us/sPages/scholarshipsAll.cfm • Tend to have early deadlines • Average scholarship per first-time, full-time undergraduate for 2011-2012

37. Private Scholarships • Student should check with local businesses, civic organizations, parents’ employers • Free internet search sites: www.collegeboard.com/pay www.scholarshipamerica.org www.fastweb.com www.studentscholarshipsearch.com www.gocollege.com www.careeronestop.org www.scholarshiphelp.org • Free Scholarship Coach handout • Students should be sure to report any private scholarships to the financial aid office #14

38. Federal and State Work Study • Undergraduate or graduate students are eligible • Employment may be on or off campus – resume builder! • May work during summer • Wages won’t count against student’s future financial aid eligibility on FAFSA • Respond ‘Yes’ to Work Study question on FAFSA • Contact financial aid office for further information

39. Student Loan Programs #12 • Loan comparison chart covers main features of all federal and state student loan programs • Reverse side displays various loan repayment options for federal student loans • General Rule of Thumb: • Don’t borrow more than expected first year salary in field • Monthly payment will typically be around 1% of total student loan debt • $290 for $29,000 debt

40. Student Loan Forgiveness/Cancellation • Perkins loan cancellations for teachers and other professionals • Federal Direct Loan forgiveness for teachers • Teach 5 consecutive academic years • $5,000 to $17,500 depending on level, subject • Public Service Loan Forgiveness • First select income-driven, extended repayment plan • Work in public service and make loan payments for 10 years • Apply for forgiveness of remaining balance • More info at: www.studentloans.gov

41. Tuition Reciprocity • Allows MN residents to attend in neighboring states at rate similar to MN resident rate • Students need to apply (some assume it’s automatic) • Apply directly to ND or SD college if recent MN high school graduate • Apply directly to colleges in Manitoba • All other students must submit application to Office of Higher Education in MN • Apply on-line for 2015-2016 after March 1, 2015 at: • www.getreadyforcollege.org • Reduced rates for MN residents attending select schools in Illinois, Indiana, Kansas, Michigan, Missouri, Nebraska under Midwestern Student Exchange Program (MSEP)

42. Federal Higher EducationTax Advantages American Opportunity Tax Credit Lifetime Learning Tax Credit Tuition and Fees Deduction Penalty Free IRA Withdrawals Coverdell Education Savings Account Student Loan Interest Deduction See Publication 970 at: www.irs.govfor details Also, handout in packet #16

43. Helpful Resources • College financial aid administrator knows best!! • (Contact info provided in Paying for College) • Questions on federal aid programs and application process (800) 433-3243 • www.studentaid.ed.gov • Office of Higher Education financial aid staff (651) 642-0567 or (800) 657-3866 • www.getreadyforcollege.org

44. Student PublicationsOffice of Higher Education Ordering instructions in right side of packet (Financial Aid Basics also in Spanish, Hmong, Somali) Federal publications ordering instructions also included

45. MAFAA Help for High Schools! • For financial aid night help (e.g. speakers) • www.mafaa.org/public/public.php • Please consider making your financial aid night a College Goal event! • College Goal volunteers will help you! • See MAFAA and College Goal handouts in right side of packet

46. FAFSA Completion Initiative !!! • MN OHE hopes to contract with Colorado for use of FAFSA data sharing web portal starting 2015-2016 • MN high schools, districts and other organizations providing direct service to students can: • Sign participation and data sharing agreement • Get username and password to access system • Get FAFSA completion data for students • Aggregate numbers by high school • Individual student data showing • If student has submitted FAFSA • Whether FAFSA is complete, lacks signatures or has other unresolved problems

47. FAFSA Completion Initiative !!! • MN OHE will contact all high schools, districts and organizations when participation agreements are ready • Training will be provided via webinar 90% of seniors who complete the FAFSA enroll in college within 12 months! No way! Way!

48. FAFSA Completion • Easy-to-use social media tools to promote FAFSA completion • Tweets • Facebook posts • YouTube videos • Instructions on how to use the above • You can also retweet/repost content from: • www.facebook.com/FederalStudentAid • www.twitter.com/FAFSA • www.youtube.com/FederalStudentAid • See High School Counselor Tools (right side of packet)