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Let's say I have $19,000 combine in savings and checking but $8000 in credit card debt.

The form asks for savings/checking. Do I have to enter the $19,000 or could I maybe get away with $11,000 and be OK or are these audited heavily which would result in false information provided?

It's not that I want to falsify information, it's just I don't want to lose out on aid because I built up a savings for emergency over the years and paying off the CC debit when the 0% APR runs out.

If they are heavily audited then I would just pay off the CC and hope that the difference results in a better FAFSA grant.

I've completed the following(below) and I've sent these off before to other schools and this is the first school I've seen request assets so I'm not sure if this is the end of verification or not. Copy of Student's 2015 IRS Tax Return Transcript
Online Federal Verification Worksheet-Student

5

According to this:

Your reportable assets include:

Your cash on hand — and whatever you have in your checking and savings account(s) as of the date you file the FAFSA.

In addition,

The FAFSA does not offset income or assets by unsecured consumer debt, such as credit card debt, or by debt secured by a non-reportable asset, such as a mortgage on the family home. So, using extra money to pay down debt may effectively make the money disappear on the FAFSA.

What that means is that if you pay off your debt, then it'll look like you have less money on hand to pay for school - thus potentially qualifying you for more aid.

Generally, you won't be "audited" based on what you fill out on your FAFSA form. At most, you would get selected for additional verification, where then you would have to submit a copy of your tax transcripts (not returns, but transcripts - see difference here.)

However, if your aid package is not sufficient enough and you try to obtain more aid, the school's financial aid office might require you to submit additional supporting documents, such as your bank and credit card statements. Obviously, if this happens, and there was a major difference in what you have vs what you stated, then your request could be denied.

Verification sometimes is randomly, sometimes it is not. At the financial aid office I worked at, around a third of the students were selected for verification, which just means the school wanted to make sure that the AGI, etc. you reported matches what the IRS has. Not everyone is selected for verification, and if you aren't, and you are in a situation where you need more aid, then that's when the school may ask for addition documentation (bank records, etc.).

  • Strange that the "audit" is for tax info, which wouldn't contain any records of savings. – TTT Jun 5 '17 at 21:44
  • The last paragraph seems to imply that if you request aid you may be given some, but if you prove you weren't lying then you could be given even more. – TTT Jun 5 '17 at 21:47
  • @TTT I updated my answer, hopefully it makes more sense. Financial aid is a tricky area. – Michael Jun 5 '17 at 21:52
  • Good edits. Thx. – TTT Jun 5 '17 at 21:58

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