A Guide to the FAFSA for Students with Divorced Parents

Our families come in many forms, and that can get tricky once it comes to applying for financial aid for college. Here are a few tips and tricks for filling out the Federal Application for Student Aid (FAFSA) if your family structure is unconventional.

Why Fill Out the FAFSA?

The short answer is that this is a great source of support for students enrolling in college. Completing this application makes your child eligible for federal and state aid. This is not money you want to leave on the table.

For a detailed description of this form and how to complete it, see CollegeVine’s The Ultimate Guide to Filling Out the FAFSA.

The article that follows can be thought of as an addendum for families in which both biological parents are not married to one another.

The FAFSA vs. The IRS

You already report your income and assets to the IRS every year. However, as you read this article, you will see that the FAFSA considers parents’ financial obligations to their children a little differently. It can be frustrating to navigate, for example, the difference between a parent with custody and a custodial parent.

Keep in mind that these entities exist for different purposes. The FAFSA’s sole purpose is to connect students with state and federal aid to attend college, while the IRS exists to determine each individual’s tax burden. Over the years, these distinct goals have given rise to some subtle but important differences in how they address financial aid.

How the FAFSA Considers Parents Who Are Unmarried, Separated, or Divorced

For Biological Parents Who Never Married

The FAFSA treats parents who never married in exactly the same way as parents who married and divorced. You can skip down to the section “For Parents Who Have Legally Divorced” for more information on your contribution.

For Parents Who Are Separated But Not Divorced

For separated parents, it all comes down to current living situation. As a rule of thumb, parents who live under the same roof should file together.

For legally married parents living apart, file as “separated or divorced.”

For legally separated parents, it all depends on who lives with the child. If two legally separated parents still reside together, complete the form as “married or remarried.”

If the separated parents live apart, complete the form as “divorced or separated.”

For Parents Currently Seeking Divorce

If you are in the process of a divorce and you think your child may attend college one day, include provisions for paying for college in your divorce agreement, just as you would for child support. We recommend that each parent commit to the following:

• Support the student for ten semesters OR until the student earns a bachelor’s degree, whichever occurs sooner.
• Pay 50% of in-state college tuition plus room and board OR 50% of tuition plus room and board for the school where the child does enroll, whichever cost is lower.
• Tuition and room and board payments are to be made directly to the school unless the student chooses to live off-campus, in which case room and board only are to be sent directly to the student at regular intervals.

Some parents add additional information regarding college costs, including textbooks, transportation, and health insurance. Most college websites enumerate expected figures for these additional costs of attendance. Additionally, some parents stipulate GPA or minimum course requirements. We advocate against this practice, as schools vary in what constitutes a good GPA or minimum course load.

This is a general agreement, but feel free to customize based on the financial capacity of each parent and the academic plan of the student. For example, if one parent has a substantially higher income, you may choose to say that parent is responsible for 80% of tuition plus room and board. Or, if the student wishes to enroll in a program of accelerated study, such as a BS/MD program, parents may agree to finance sixteen semesters rather than ten.

For Divorced Parents

If the child’s parents are divorced, the custodial parent must be the one to complete the FAFSA. Note that custodial parent means something different from the parent with custody. To determine the custodial parent, answer these three questions in order.

1. With whom has the child lived for more of the past 12 months?

Count back from the date when you are filing the FAFSA. Has your child lived with one parent or the other for more days of the year? Since most years have an odd number of days, there is often a correct answer even with joint custody arrangements. This parent is the custodial parent and should fill out the FAFSA.

If the child has lived with both parents for exactly the same number of days, ask:

2. Who has financially supported the child more in the past 12 months?

Again, count back from the date when you are filing the FAFSA. If there is a difference in financial contribution, down to the penny, the parent who has contributed more is the custodial parent.

If both parents have contributed equally, ask:

3. Which parent earns the greater income?

If the child has lived with both parents for the exact same number of days and if both parents have contributed equally to the child’s financial support, then the parent with the larger income is named the custodial parent. 

The wealth of the non-custodial parent is NOT considered in the FAFSA. Some private colleges and universities may use this information, but federal and state aid does not consider this parent’s income and assets when determining how much aid the government will give the student.

For Stepparents

If the custodial parent has remarried, this stepparent’s wealth is considered when determining financial aid, regardless of how long the marriage has existed. 

In the event that the stepparent has since died, their estate is considered when determining federal and state aid for the child.

Even in cases where a prenuptial agreement exists between the stepparent and the custodial parent, the stepparent’s income and assets are considered in the FAFSA. No financial agreement between two parties can be binding on a third party, so prenuptial agreements do not impact government-issued financial aid.

Only the stepparent of the custodial parent is considered on the FAFSA. The spouse of the non-custodial parent is not factored into decisions about government-issued financial aid.

Claiming Tax Benefits

Education tax benefits have nothing to do with how a family completes the FAFSA. If you claim your child as a dependent on your federal tax forms, you qualify for education tax benefits.

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