FAFSA confusion: 2022 tax returns vs current asset values - what do they actually want?
I'm filling out the Parents Financials section on the FAFSA for my daughter and I'm completely confused by the wording. It starts by saying I'll need my 2022 tax returns (which I gave permission for IRS data retrieval) to answer the "following questions." But then it asks about the "current total" of cash/savings/checking accounts and "current net worth" of investments. Am I supposed to use figures from my 2022 tax return or my actual current balances as of today? The wording seems contradictory. The system won't let me skip ahead to see if later questions specifically reference the 2022 tax return or which line items they need. I've been staring at this for an hour and I'm losing my mind. Anyone know exactly what they're asking for here?
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Emma Swift
The FAFSA is asking for two different types of information: 1. For income questions: They use your 2022 tax return data (which you've allowed them to import through the IRS Data Retrieval Tool) 2. For asset questions: They want CURRENT values as of today (cash, savings, checking, investments, etc.) This is often confusing because they reference the tax return at the beginning of the section, but the asset questions are asking about your present financial situation, not what you had in 2022. Hope this helps clarify things!
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Max Knight
•Thank you so much for clearing that up! It seemed illogical that they'd want 2022 asset values when those could be completely different now. I appreciate the help!
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Isabella Tucker
ya this tripped me up 2 when i was helping my kid do his fafsa last week!! the 2022 tax stuff is just for your income but all the asset stuff is supposed 2 be RIGHT NOW like literally what u have in ur accounts today
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Jayden Hill
•This is correct! 👆 That's exactly why they call it "current" assets. They want to know what you have NOW, not back in 2022.
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LordCommander
I was confused by this exact same thing two days ago! It's so frustrating how unclear the instructions are. I ended up calling the Federal Student Aid Information Center and waiting on hold for over 2 HOURS only to have the call drop right when someone finally answered. I was furious.
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Lucy Lam
•If you need to call FSA again and don't want to waste hours on hold, try using Claimyr (claimyr.com). I was skeptical at first, but it actually works - they hold your place in line and call you when an agent is available. Saved me so much time when I had issues with the Parent PLUS loan application. There's a demo video showing how it works: https://youtu.be/TbC8dZQWYNQ
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Aidan Hudson
Just wanted to add - make ABSOLUTELY SURE you report current assets accurately! My son's friend put down their 2022 asset values by mistake, and they got flagged for verification because their current FAFSA assets were way different from what they reported on previous years' FAFSAs. Ended up delaying his financial aid package by 2 months while they sorted everything out.
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Max Knight
•Oh no, that's exactly what I was worried about! I definitely don't want to get flagged for verification. I'll make sure to use current values.
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Zoe Wang
The FAFSA has been using the "prior-prior year" tax information for several years now, which is why they're asking for 2022 tax data for the 2025-2026 academic year. However, for assets, they always want current values because those can be liquidated if necessary to pay for education. Also important to note: certain assets DO NOT need to be reported on the FAFSA, including: - The value of the primary home you live in - Retirement accounts (401k, IRA, etc.) - Life insurance policies - Family-owned small businesses with fewer than 100 employees Make sure you're not over-reporting by including these!
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Max Knight
•This is incredibly helpful! I was about to include our home equity and my retirement accounts in the investment values. You just saved me from severely overreporting our assets!
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Jayden Hill
I HATE THIS SECTION SO MUCH!!! Why can't they just say "Current assets: Enter what you have NOW" and "Past income: Enter what you made in 2022" instead of this confusing mess???
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Connor Richards
•RIGHT?? The gov could save millions in support calls if they just hired a decent UX writer for their forms. The amount of collective American hours wasted on confusing FAFSA language must be astronomical 🤦♀️
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Isabella Tucker
ooh also i just remembered the worst part - make sure u dont count ur retirement savings in the assests - thats a HUGE mistake alot of ppl make. they only care about cash, regular investment accounts, and real estate thats NOT your primary home
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Max Knight
•Thank you! Someone else mentioned that too - I definitely would have included retirement accounts if I hadn't asked. The instructions really should make this clearer.
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Lucy Lam
One more important clarification: when listing current investments, remember this includes: - Real estate (except the home you live in) - Trust funds - UGMA/UTMA accounts - 529 college savings plans - Money market funds - Mutual funds - Certificates of deposit - Stocks and bonds But does NOT include: - Retirement plans (401k, pension funds, annuities, IRAs) - Life insurance - Your primary residence The SAI (Student Aid Index) calculation hits non-retirement investments much harder than cash savings, so accurate reporting is critical.
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Max Knight
•This is extremely helpful. I have a rental property and wasn't sure if that should be included, but now I know it should. Really appreciate the detailed breakdown!
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