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Error on FAFSA May Have Affected Low-Income Students

Error on FAFSA May Have Affected Low-Income Students - The Beacon


By: Amanda

Error on FAFSA May Have Affected Low-Income Students

Your BBB has learned that several thousand student applications for federal aid may have been incorrectly processed.   According to the Department of Education, they were receiving word from schools that a high number of FAFSA applications appeared to have an incorrect value in the “Income Earned from Work” section. While the instructions for the FAFSA on the Web form asked the students and parents to round cents to the nearest dollar, those that did not appeared to have more income than they actually received. For example, if a student put in that they earned $3121.43; the system read it as $312,143. This error would likely have caused an incorrect determination in the student’s eligibility for federal grants and other aid.

As of July 1st, the Department of Education reports that it has fixed the error for future applications, and is working to identify those applications that may have been affected. They believe that less than 200,000 students were affected nationwide. The Department of Education is also informing colleges and universities nationwide, for the applications identified with a potential error; they must review, at minimum, “the applicant’s Adjusted Gross Income and Income Earned from Work fields to confirm their accuracy or to make any necessary corrections.”

According to the Department of Education, “the review (and any subsequent corrections) should be completed before subsidized Title IV aid is disbursed for the 2014-2015 award year. If such aid has already been disbursed the institution may need to change awards and return (or have the student return) any over awarded funds.”

While colleges and universities will be reviewing financial fields for those that may be affected, if any student needs to make corrections to their FAFSA, you can find out which ones can be made and how here.

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Amanda is the Director of Bureau Affairs and is a regular contributor to the consumer education blog. She is one of our go-to colleagues for answering complex consumer inquires. Amanda also manages our charity reporting program.