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Understanding what it means to be a dependent for financial aid

March 31, 2021

It is an important term in financial aid, but one that often creates a lot of confusion among students and parents.

That term is “dependent student,” and the key word here is “dependent.”

Often when students or parents hear the word dependent, they think of their income taxes. If a parent claims a student on their taxes, then that student is a dependent for tax purposes. However, that student may or may not be a dependent when applying for financial aid. The opposite is also true. Just because a parent does not claim a student on their taxes, the student is not necessarily considered an independent student for financial aid purposes.

Dependent students must provide parental financial information, in addition to their own financial information. Independent students only report their own financial information. The status is important because it does impact how much financial aid a student may be eligible to receive.

The key to understanding who is a dependent for financial aid purposes is to remember that the definition of a dependent for financial aid purposes is completely different than for tax purposes. A student must  meet certain criteria to be considered an independent student and whether they are claimed on taxes in not part of that criteria.

The confusion is understandable – especially because parents are providing financial information, including income tax return information, on the Free Application for Federal Student Aid (FAFSA).

Many students (and probably most high school students) are considered dependent students on the FAFSA unless they can answer yes to one of the following questions:

  • Do you have children who receive more than half of their support from you?
  • Do you have dependents (other than children or a spouse) who live with you and receive more than half of their support from you?
  • Are you currently serving on active duty in the U.S. armed forces for purposes other than training?
  • Are you a veteran of the U.S. armed forces?
  • At any time since you turned age 13, were both of your parents deceased, were you in foster care, or were you a ward or dependent of the court?
  • Are you an emancipated minor or are you in a legal guardianship as determined by a court?
  • Are you an unaccompanied youth who is homeless or self-supporting and at risk of being homeless?
  • Will you be working toward a master’s or doctorate degree (such as M.A., MBA, M.D., J.D., Ph.D., Ed.D., etc.)?

There are many reasons why a parent may or may not want to claim a child on an income tax return and while that may impact the amount of taxes paid, it won’t impact whether a student is dependent or independent when applying for financial aid.