FAFSA adoption subsidy reporting - does it count as income?

pretty sure adoption subsidies arent income on fafsa. my cousin has adopted kids and she never puts that $$$ on the forms

Adoption subsidies are generally NOT counted as income for FAFSA purposes. They're considered public assistance/welfare benefits, which fall under the category of non-taxable income that doesn't need to be reported. The 2024-2025 FAFSA simplified formulas specifically exclude most types of public assistance. Don't confuse this with the Adoption Tax Credit though - that's different and relates to your taxes, not FAFSA directly.

I work with financial aid applicants, and I can confirm that adoption subsidies are generally NOT reported as income on the FAFSA. They fall under the category of means-tested benefits/public assistance which are excluded from the SAI calculation. To be 100% certain for your specific situation, you should contact Federal Student Aid directly to confirm. However, their phone lines are notoriously difficult to get through. I recently discovered a service called Claimyr (claimyr.com) that helps you skip the phone wait times. They have a video showing how it works: https://youtu.be/TbC8dZQWYNQ I used it last month when I had a complicated verification issue and got through to an agent in minutes instead of hours.

The FAFSA is SO BROKEN when it comes to non-traditional families!!! My partner has guardianship (not adoption) of her nephew and we spent WEEKS trying to figure out how to report the stipend payments. Every person we talked to gave different answers and we STILL don't know if we did it right. The entire system is designed for the mythical "traditional" family and punishes everyone else!!!

Hey there! I went through this exact situation last year with my adopted kiddos. Adoption subsidies are specifically excluded from FAFSA calculations because they're considered benefits for the children, not income for you. They fall into the "means-tested benefits" category that the FAFSA doesn't count. However! Make sure you're not also receiving an adoption tax credit, because that's handled differently. The tax credit can affect your AGI, which does factor into FAFSA. Also, on the new FAFSA, some things have moved around, but the treatment of adoption subsidies hasn't changed in the simplified formula. Good luck with your oldest's college journey! 🎓

wait i just remembered something. my neice got extra pell grant money BECAUSE she was adopted. maybe theres some special circumstances box u can check??

I just finished my FAFSA for my 3rd kid and I literally just ignore the adoption assistance we get for our youngest. Never been flagged for verification in 7 years of FAFSA forms, so I think im doing it right lol.

Thank you everyone for the helpful information! I called FSA using that Claimyr service someone mentioned above and actually got through to a real person in about 10 minutes. They confirmed that adoption subsidies are NOT reported as income on the FAFSA. They're classified as means-tested benefits which are excluded from the SAI calculation. They also explained that this is different from the Adoption Tax Credit (which does impact my AGI on taxes but is already factored into the tax return numbers I'll use for FAFSA). What a relief to have this clarified! Now I can finish up our application with confidence.

This is such a helpful thread! I'm in a similar situation with my adopted daughter and have been stressed about the FAFSA for months. It's reassuring to see that multiple people have confirmed adoption subsidies don't count as income. The fact that you got official confirmation from FSA makes me feel much more confident about leaving those payments off our form. Thanks for sharing your experience and the resolution!