2024-2025 FAFSA Changes

How the FAFSA Simplification Act Affects You

Big changes are coming to the Free Application for Federal Student Aid (FAFSA) application for the 2024-2025 aid year.

The FAFSA Simplification Act was passed by Congress in 2020 and represents a significant overhaul of the processes and systems used to award federal student aid. This includes the Free Application for Federal Student Aid (FAFSA) form, the need analysis that determines federal aid eligibility, changes in terminology, and many policies and procedures for schools that participate in federal student aid programs.

2024-2025 FAFSA Available in December 31, 2023

Historically, the FAFSA has been available beginning October 1st of each year. However, because of significant changes to the application and the rebuild of the FAFSA processing system, the 2024-2025 FAFSA will not be available until December 31, 2023.

What’s changing with the FAFSA?

There are a number of benefits of the FAFSA simplification act, including a more streamlined application process and a better user experience for the FAFSA, expanded eligibility of federal student aid, and reduced barriers for certain student populations (e.g., homeless and unaccompanied youth, incarcerated students, English language learners, and students from low-income backgrounds).

Some fundamental changes include, but are not limited to:

  • The FAFSA will be shorter and more user-friendly.
    • The FAFSA will reduce the maximum number of questions. This streamlined format will simplify the application process and make it less daunting for students and their families.
  • Student may list up to 20 Colleges.
    • Previously, the FAFSA only allowed students to list up to 10 colleges and universities.
  • The FAFSA will be available in more languages.
    • Currently, the FAFSA is only available in English and Spanish. The 2024-2025 application will be expanded to include the 11 most common languages spoken by English learner students and their families.
  • Applicants will be required to use the IRS Direct Data Exchange.
    • Previously, users had the option to enter their tax information manually or use IRS Data Retrieval Tool. Beginning with 2024-2025, all persons on the FAFSA must provide consent to the Department of Education to receive tax information or confirmation of non-filing status directly form the IRS. In a very small number of cases, students and families will have to enter their tax data manually, but for most, that data will be automatically transferred into the application. This change makes it easier to complete the FASFA and reduces the number of questions to be answered.
  • All “contributors” must provide financial information.
    • A contributor-a new term being introduced to the 2024-2025 FAFSA-refers to anyone who is required to provided information on the student’s form (such as a parent/stepparent or spouse). A student’s or parent’s answers on the FAFSA will determine which contributors (if any) will be required to provide information.

Contributors will receive an email informing them that they’ve been identified as such, and will need to log in using their own FSA ID (if they don’t already have one) to provide the required information on the student’s FAFSA.

Being a contributor does not mean they are financially responsible for the student’s education costs, but it does mean the contributor must provide information on the FAFSA or the application will be incomplete and the student will not be eligible for federal student aid.

2024-2025 Contributor Prep:

  • Student Aid Index (SAI) is replacing Expected Family Contribution (EFC).
    • A notable terminology update within the new FAFSA is the replacement of the terms Expected Family Contribution (EFC) with the Student Aid Index (SAI). This name more accurately describes the number used to determine aid eligibility and, unlike the EFC, the SAI may be a negative number down to -1500.
  • The number in college will not be used to calculate SAI.
    • Previously, the FAFSA calculated the number of household members attending college into the EFC, dividing it proportionately to determine federal aid eligibility. Beginning with the 2024-2025 FAFSA, the application will still ask how many household members are in college, but your answer will not be calculated into the SAI. As such, undergraduate students with siblings in college may see a change in their federal aid eligibility.
  • Some student will automatically be awarded a Pell Grant.
    • Families making less than 175% and single parents making less than 225% of the federal poverty level will see their students receive a maximum Federal Pell Grant Minimum Pell Grants will be guaranteed to students from households below 275%, 325%, 350%, or 400% of the poverty level, depending on household structure. Pell awards between the maximum and minimum amounts will be determined by SAI.
  • The parent responsible for submitting the FAFSA in cases of divorce or separation has changed.
    • For dependent students, financial information was previously needed from the parent(s) the student had lived with the most in the last 12 months. With the new FAFSA, financial information will be required from the parent(s) who proved the most financial support to the student.
  • Family farms and small businesses must be reported as assets.
    • When required, families must now report the value of their small business or family farm. If the family includes the principal place of residence, applicants should determine the total net value of all farm assets and subtract the net value of their principal residence to determine the final value of their farm assets.
  • Enrollment categories will change for calculating Pell Grant.
    • Previously, Pell Grant was awarded based on full-time (12 or more hours), three-quarter-time (9-11 credit hours), half-time (6-8 credit hours) or less-than-half-time (1-5 credit hours) enrollment statuses. For 2024-2025, the enrollment statuses will be replaced with a new term called “enrollment intensity.”

Enrollment intensity is the percentage of full-time enrollment at which a student tis enrolled, rounded to the nearest whole percent. For example, if full-time enrollment is 12 or more credit hours and the student is enrolled in 7 credit hours, the enrollment intensity would be (7/12) x 100% = 58%.

For the 2024-2025 award year and thereafter, a student’s scheduled Pell Grant award is multiplied by the student’s enrollment intensity percentage to determine the Annual Pell Grant Award.

  • Changes to Year-Round Pell Grant
    • Previously, a Pell Grant-eligible student must have been enrolled at least half-time in a payment period during which they received more than 100% of their scheduled award.
    • Beginning 2024-2025, new change removes the half-time enrollment requirement.

What isn’t changing with the FAFSA?

While FAFSA is receiving and update and the aid eligibility calculation has been revised, there are a number of aid-related matters that will not change.

  • The FAFSA will still be required for consideration of federal and state financial aid every year.
  • The FAFSA will still request tax information from the prior-prior year, which mean you’ll report 2022 income and assets on your 2024-2025 application. Families with significant reductions in income can contact the Office of Financial Aid and Scholarships.

When should I submit the 2024-2025 FAFSA?

New students who plan to begin classes in the Fall 2024 semester should complete the FAFSA as soon as it becomes available on December 31, 2023.