Where to upload tax exempt income letter for FAFSA? Daughter's eligibility at stake!
I'm filling out the FAFSA for my daughter's first year of college and I'm completely stuck on how to handle my tax-exempt income situation. I receive disability benefits that are 100% tax exempt, and I have an official letter confirming this status. The FAFSA form keeps asking for tax return info I don't have, and there's no obvious place to upload my tax exempt documentation! I've heard tax-exempt income might actually help her qualify for more aid, but I'm afraid her application will be rejected if I can't properly document my situation. Does anyone know where/how to upload a tax exemption letter on the studentaid.gov site? Or do I need to contact someone directly? Her application deadline is coming up in 3 weeks and I'm starting to panic.
15 comments


Javier Gomez
you dont upload it now. mark that you wont file taxes and theyll probably select u for verification later. thats when you send the letter
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NebulaNinja
•Really? So I just select 'Will Not File' even though technically I'm not required to file? I'm worried they'll think I'm trying to hide income or something. Has anyone actually done this successfully?
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Emma Wilson
You're right that tax-exempt income can potentially help with FAFSA eligibility. Here's what you should do: 1. On the FAFSA, select "Will Not File" when asked about tax filing status 2. When it asks about income, report your disability benefits in the "Untaxed Income" section (not the AGI section) 3. You don't upload documentation during initial application 4. After submission, your daughter's FAFSA may be selected for verification 5. During verification, you'll submit your tax exempt documentation If you're still uncertain, you can call the Federal Student Aid Information Center at 1-800-433-3243, but be prepared for long wait times.
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NebulaNinja
•Thank you so much for the detailed explanation! I was looking all over for an upload button that doesn't exist. I'll report it under untaxed income instead of trying to upload anything now. I appreciate the help!
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Malik Thomas
I went through this EXACT same thing last year with my tax exempt veteran benefits!!! It's so frustrating how the FAFSA doesn't clearly explain this anywhere. I ended up calling FSA and waiting TWO HOURS only to get disconnected. Called back and waited another hour before finally getting someone who knew what they were talking about. Such a waste of time for something that should be clearly explained on their website!!!
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Isabella Oliveira
•omg same. i got disconnected THREE times trying to figure out how to handle my unemployment benefits. fafsa system is the worst
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Ravi Kapoor
If you need to get through to an actual FSA agent without the crazy wait times, try using Claimyr (claimyr.com). I discovered it after being disconnected twice during my 90+ minute waits. They basically hold your place in line and call you when an agent is ready. They have a video showing how it works: https://youtu.be/TbC8dZQWYNQ My daughter's situation was complicated because I receive disability and SSI, and I needed specific guidance on how to report it. Got through to someone who actually knew what they were talking about in about 20 minutes using this service.
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NebulaNinja
•I've never heard of this before, but I'm definitely going to check it out. Those wait times sound terrible, and I really need to talk to someone who knows about tax exempt situations specifically. Thanks for sharing!
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Freya Larsen
I work in a financial aid office and wanted to clarify a few points about tax-exempt income: 1. Disability benefits should be reported in the "Untaxed Income and Benefits" section of the FAFSA, not as taxable income 2. Select "Will Not File" for your tax filing status 3. The system is designed to compare your FAFSA with IRS records, which is why verification often happens with non-filers 4. During verification, you'll need to submit a "Verification of Non-Filing Letter" from the IRS along with your tax exemption documentation 5. Tax-exempt income DOES count toward your total income for FAFSA purposes, but it's treated differently than taxable income in the SAI formula Don't worry about having documentation ready now - just complete the form accurately and respond to any verification requests later.
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GalacticGladiator
•So does this mean disability counts against you for FAFSA? My sister gets SSDI and her daughter got almost no aid because they counted all her benefits as income. Seems totally unfair to count disability against students!
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Isabella Oliveira
wait im confused does tax exempt mean u dont have to do taxes at all? or just that u dont pay taxes on that money??
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Emma Wilson
•Tax-exempt income means that specific income is not subject to federal income tax. If someone's ONLY income is tax-exempt (like certain disability benefits), they typically aren't required to file a tax return. However, if they have other taxable income that meets filing thresholds, they would still need to file but wouldn't include the exempt income in taxable calculations. For FAFSA purposes, tax-exempt income still needs to be reported as "untaxed income" even though it's not taxed by the IRS.
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NebulaNinja
UPDATE: I called FSA using the Claimyr service someone recommended below (actually worked!), and got confirmation on handling my tax-exempt situation. The agent confirmed I should select "Will Not File" and include my disability income in the untaxed income section. She mentioned I'll likely be selected for verification, at which point I'll need to provide: 1. My official tax exemption letter 2. A Verification of Non-Filing Letter from the IRS (request online at irs.gov) 3. Documentation of my disability benefits Just wanted to update in case anyone else has this same question! Thanks for all the help, everyone.
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Emma Wilson
•Thanks for coming back and updating us! This is exactly the right process. One additional tip: keep digital copies of all these documents handy throughout the entire aid process. Sometimes schools will request additional verification beyond the initial FAFSA verification.
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Malik Thomas
Just an FYI - make sure your daughter also applies for outside scholarships! My son qualified for decent FAFSA aid with my disability situation, but we still had a big gap to fill. The disability scholarships were super helpful (there are several specifically for students with disabled parents). Don't forget to check with her specific schools too - many have supplemental forms that can help identify extra institutional aid she might qualify for. Good luck!
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