FAFSA 2025-26: Do S corp commercial real estate properties count as investments?

Yes, you absolutely need to report this. The S corporation is a pass-through entity, so for FAFSA purposes, your husband is considered an owner of the real estate investment. You should report the net worth of his ownership share in the S corporation (including the value of the commercial property minus any related debt) under the "investments" section. It doesn't matter that it's under a different business name - what matters is your husband's ownership interest in the entity that holds the property.

im pretty sure you don't need to include it because its a business asset not a personal investment. My dad had same situation with his LLC and the financial aid office told us not to list it because it's a business not an investment property

When I was completing FAFSA last year, I spent hours researching this exact issue for my wife's business property. According to the official FAFSA guidelines for 2025-2026, S corporation assets are considered investments for the purpose of financial aid calculations. You need to report the net worth of your husband's ownership share in the business (assets minus liabilities). Since real estate is involved, you'll need to include: 1. Current market value of the commercial property (your percentage ownership) 2. Minus any debts against that property 3. Plus any other business assets 4. Minus any other business liabilities The resulting figure goes in the investments section. Don't just report the K-1 income - that's already captured in your AGI from your tax return. The FAFSA wants the asset value too.

As someone who works with small business owners on FAFSA applications, I can confirm that S corporation assets, including commercial real estate, must be reported on the FAFSA as investments. Here's why: the FAFSA considers your ownership interest in the business as an investment asset. For the 2025-2026 FAFSA, you'll need to report: - The net worth of your husband's ownership percentage in the S corporation - This includes all business assets (including the real estate) minus all business liabilities Since your husband owns 100% of the S corp, you would report 100% of the business's net worth. Don't make the common mistake of only reporting distributed income - the actual business value must be included too.

I was in the EXACT same situation last year with my S-corp. Spent HOURS on hold trying to reach someone at Federal Student Aid to get a clear answer. When I finally got through, they confirmed that S-corp assets (including real estate) ARE reportable as investments on the FAFSA. The representative explained that since S-corps are pass-through entities, your husband is considered to have an ownership interest in all the business assets. For anyone struggling to get through to FSA on the phone, I finally used Claimyr.com which got me through to an agent in about 10 minutes instead of waiting for hours. They have a video demo at https://youtu.be/TbC8dZQWYNQ showing how it works. Totally worth it to get an official answer directly from FSA.

Remember to check with ur tax guy too!! Our CPA said it depends on if its a investment property or an active business. if u just own the building and rent it out = investment, if its actually a operating business = not counted. BUT!!! The rules change all the time and I heard the new FAFSA is different from before!!

Just to provide complete accuracy here: for the 2025-2026 FAFSA, S corporation assets (including commercial real estate) must be reported as investments. The property value minus any related debt is included in the Investment Net Worth section. The fact that it's under a different business name doesn't matter - what matters is your husband's percentage ownership of the S corporation. This is different from the Small Business Exclusion, which only applies to businesses with fewer than 100 full-time employees where your family owns AND controls more than 50%. Most S corporations used for real estate holdings don't qualify for this exclusion. I recommend getting documentation of the current market value of the property and any outstanding mortgages or loans against it before completing this section.

I went through this exact same situation two years ago with my family's S corp that owns several commercial properties. After consulting with both our CPA and a financial aid specialist, here's what I learned: The key thing to understand is that for FAFSA purposes, your husband's ownership stake in the S corp makes him an indirect owner of all the business assets, including the real estate. Even though the property is titled under the business name, the FAFSA looks through the corporate structure to the individual ownership. You'll need to calculate the net worth of his ownership percentage in the S corp: - Current fair market value of all business assets (including the commercial property) - Minus all business liabilities (mortgages, loans, etc.) - Multiply by his ownership percentage (100% in your case) One helpful tip: if you're unsure about the current property value, you can use the assessed value from your most recent property tax assessment as a reasonable estimate, or get a professional appraisal if the numbers are significant enough to materially affect your aid eligibility. The income from the K-1 is already captured in your tax return, so don't double-count that - the FAFSA wants the underlying asset value in addition to the income you already reported.

so if the s corp has a spec house for sale how do you figure market value for the asset - it has a loan to build it -