Pay for Faculty Like a Professional: Taxes and the FAFSA
on Apr 4, 2024
In case your youngster is a sophomore in highschool proper now, this yr is tremendous necessary in your faculty funding plan!
To be eligible for monetary assist (grants & scholar loans) for school your youngster might want to submit your tax return as a part of their FAFSA utility when making use of to schools of their senior yr. The FAFSA makes use of the Prior-Prior Yr earnings to find out eligibility. So…in case your youngster is a sophomore in highschool proper now…2024 is the tax yr that will probably be used for monetary assist eligibility.
The excellent news is you continue to have 9 months (loads of time!) left within the tax yr to make sensible strikes in the event you hope to enhance your eligibility for monetary assist. As you file 2023 taxes, take a second to consider what you are able to do to optimize your 2024 tax yr particularly you probably have a baby of their sophomore yr in highschool. Generally, you wish to make the most of the whole lot out there to you to cut back your earnings (Do’s) and keep away from something that may improve your earnings for the yr (Don’ts). Under are some concepts however ensure that any changes you make are in coordination together with your total monetary plan and are the suitable strikes for your loved ones.
| Do’s | Don’ts |
| Improve pre-tax retirement plan contributions in the event you can. | Notice capital positive aspects from the sale of a house or different investments in the event you can. |
| Reap the benefits of different pre-tax worker advantages if it is smart for your loved ones (HSA, FSA, and so on.). | Train inventory choices if potential. |
| Promote unhealthy investments that help you have a loss towards your earnings. | Withdraw cash out of your retirement plan. |
| Delay bonus if potential. |
Paying for school is a significant monetary purpose for you and your loved ones. In case you are 0-5 years away out of your youngster beginning faculty, paying in your youngster’s faculty is rapidly changing into a actuality. Construct a timeline as your youngster enters highschool so that you don’t miss any deadlines to place you in the very best place to decrease your total faculty prices. Now’s the time to make a plan that ensures faculty prices are reasonably priced, monetary assist is maximized and use of your money movement, financial savings and investments is optimized.
My son Romas is a Senior at UCSB this yr, I’m sharing this image of him on resolution day when he determined to go there 4 years in the past! Our faculty journey is coming to an finish quickly, however I’ve a lot to share from my private expertise {and professional} data that will help you make sensible selections on your loved ones’s faculty journey. It’s by no means too early or late to have a plan!
