September 30, 2021

Some students and parents who received unemployment income in 2020 could see an incorrect reduction in their eligibility for need-based aid for the 2022-23 academic year.

Specifically, the issue impacts those students and/or parents who received unemployment benefits in 2020 and then filed their tax return prior to the passage of legislation that made some of those benefits non-taxable. If a student and parent file the 2022-23 FAFSA and use the IRS Data Retrieval Tool, it could result in a higher Adjusted Gross Income (AGI).

Students and parents who filed taxes or amended their tax returns after the passage of the legislation will not be impacted by the issue.

2022-23 FAFSA filers who think they may have been impacted by this issue should check with the financial aid office of the school or college they plan to attend.