FAFSA Simplification 2024-25 – Are You Ready?
The FAFSA Simplification & FUTURE Act was passed by Congress in December 2020. The intent of the legislation was to make the financial aid process and eligibility for Federal Pell grants more predictable for low-income students, reduce the number of FAFSA (Free Application for Federal Student Aid) Form questions, streamline the calculation for determining financial need, expand federal aid eligibility for specific populations and ultimately improve educational outcomes for low-income students.
While some provisions of the legislation went into effect for the 2023-2024 academic year, most will be implemented for the 2024-2025 academic year (Summer 2024/Fall 2024/Spring 2025). The FAFSA Simplification Act represents a significant overhaul to federal student aid, including the:
- Free Application for Federal Student Aid (FAFSA) form,
- need analysis,
- cost of attendance and
- many policies and procedures for schools that participate in the Title IV aid programs.
Hardin-Simmons University’s Office of Financial Aid has created this webpage to help others understand a few of the upcoming changes for 2024-25.
DRAFT 2024-25 Free Application for Federal Student Aid Form (FAFSA) – not for official use
- Every student and contributor to the FAFSA will need an FSA ID to complete the 2024-25 FAFSA online. This process takes approximately 3 days, so if you DO NOT have an FSA ID, you are encouraged to create one now at this location. NOTE: Federal Student Aid is still working on a process to allow individuals without a social security number to create an FSA ID. FSA states it is expected before the FAFSA release date.
- Federal Student Aid Estimator is now available. With this tool, students can find out how much federal student aid they may be eligible for starting with the 2024–25 award year—note that this tool estimates the Student Aid Index (SAI) for 2024–25 award year, not the Expected Family Contribution (EFC) for 2023–24 award year.
- The start date for the 2024-2025 FAFSA will be delayed. The 2024-2025 FAFSA will become available at fafsa.gov in December 2023 instead of on October 1, 2023. Exact date in December TBD.
- The number of questions on the FAFSA has decreased from approximately 108 to less than 40.
- The EFC (Estimated Family Contribution) will become the Student Aid Index (SAI).
- Students can list up to 20 schools on their FAFSA via the online application.
- Aligns more questions on the FAFSA with federal income tax returns.
- Important: Previously, students, a student’s spouse (when married), and parent(s) (when students are dependent) entered their tax information or used the IRS Data Retrieval Tool (DRT) to transfer tax data from the IRS to the FAFSA. Beginning with 2024-25, all persons listing tax information on the FAFSA will be required to use the IRS Direct Data Exchange (DDX) to share tax information or confirm non-filing status. DDX gives ease to the process and reduces questions to be answered. This change also requires the student, spouse, and all parents with tax data reported to get an FSA ID (if you don’t each have one already).
- Students, spouses, parents, and stepparents will now need to provide their consent in the new Consent to Retrieve and Disclose Federal Tax Information section of the FAFSA for federal student aid eligibility.
- This consent will allow the IRS to share Federal Tax Information using the Direct Data Exchange (DDX).
- If any party to the FAFSA form does not provide consent, submission of the form will still be allowed. However, a Student Aid Index (SAI) will not be calculated and you will NOT be eligible for federal student aid.
- The Custodial Parent on your FAFSA will no longer be the parent with whom you lived the most during the past 12 months, but rather the parent who provided you with more financial support, regardless of living arrangements.
- Students who qualify for a dependency override due to homelessness or not being able to access their parents’ financials, no longer need to recertify their dependency status each year, unless their situation changes.
As part of implementation of the FAFSA Simplification Act, students and families will see a different measure of their ability to pay for college, and they will experience a change in the federal methodology used to determine aid.
- Due to a change in the methodology used to determine aid, a Student Aid Index (SAI) – rather than an expected family contribution (EFC) – is used to measure the student’s (and, if applicable, the family’s) ability to pay for college.
- The new need analysis formula to calculate an SAI:
- removes the number of family members in college from the calculation.
- allows a minimum SAI of -$1,500 (but negative numbers do not increase eligibility for federal student aid or allow financial aid to go above the college’s cost of attendance (COA).
- implements separate criteria to determine eligibility for the Federal Pell Grant Program, linking eligibility to family size and the federal poverty level, making program funds available to more students.
- Child support received will be included in assets and not as untaxed income.
- Families who own a small business/farm that also serves as primary residence will now have assets of that business/farm considered in their need analysis calculation.
- The SAI will be determined using one of three formulas:
- Formula A – Dependent students;
- Formula B – Independent students without dependents other than a spouse; or,
- Formula C – Independent students with dependents other than a spouse.
- Although there is no simplified needs test in the SAI formula, certain applicants will still be exempt from asset reporting based on their income and tax filing status.
- The Pell Grant scheduled award calculation will consists of three steps:
- Step 1 – Maximum Pell Grant Eligibility;
- Step 2 – Student Aid Index Calculation; and,
- Step 3 – Minimum Pell Grant Eligibility.
Hardin-Simmons University Office of Financial Aid will provide future communication throughout the next year on these upcoming changes and is happy to assist you with the financial aid application process should questions arise. Additional information can also be found at What is the FAFSA Simplification Act? | Federal Student Aid