In 2025, the U.S. Department of Education is projected to distribute $135 billion in grants, loans, and work-study awards to millions of college students.[i] With these financial aid programs, tuition, room and board, books, and other college-related expenses can become more affordable. To determine if your student qualifies for these federal funds, you must fill out the Free Application for Federal Student Aid or FAFSA.
Starting with the 2025-26 award year, the process for applying for aid using FAFSA has been simplified and includes:
· expanded eligibility for federal student aid and
· a more streamlined application process.
The FAFSA application is available starting in December 2024 for the 2025-26 academic school year. [ii]
Documents you need for the FAFSA
Before applying for the FAFSA, it's a good idea to gather the documents and information you'll need to apply. The documents include the following:
- Your tax returns and W-2 forms
- Records of untaxed income, such as child support and interest income
- Records of assets, like savings accounts and investment accounts
- Social Security numbers of your student and both parents
- Your own phone number and email (student and parent)
It's important to note that the FAFSA system will link to the IRS.gov website to pull income tax records automatically into the FAFSA application. However, if an error occurs, having your tax returns close will enable you to correct errors and then submit the FAFSA application. [iii]
How to Submit the FAFSA
Once you’re ready to apply for the FAFSA, follow these steps:
- Visit www.studentaid.gov.
- Create a Federal Student IDA or FSA IDA.
- Answer each question thoroughly and accurately.
- List the colleges, technical schools, or universities your student is considering.
Be sure to submit the FAFSA for the 2025-26 school year before the deadline; The FAFSA form must be submitted by 11:59 p.m. CT on June 30, 2026. Any corrections or updates must be submitted by 11:59 p.m. CT on Sept. 12, 2026.[iv]
Each college may have its own deadline so ask your college about its definition of an application deadline. It may be the deadline date your FAFSA is processed or the date the college receives your FAFSA data- be sure to check!
The sooner you fill out the FAFSA, the more likely your student will receive all the aid they may be entitled to.
What happens after the FAFSA is submitted?
If you complete your FAFSA application online, the Department of Education will take 7 to 10 days to process it. [v]Then, you'll receive a student summary report (SAR) and an estimate of what the family and student are expected to contribute using the Student Aid Index (SAI).
The new FAFSA need analysis formula removes the number of family members in college from the calculation, allows a minimum SAI of -1500, and implements separate eligibility determination criteria for Federal Pell Grants.[vi] The new formula also aligns more with what was reported on the student/parents tax returns regarding family size when determining eligibility.
Next, FAFSA will share the SAR report with up to 20 schools your student applied to.[vii] The financial aid office at each college, tech school, or university will consider these factors to calculate your student’s financial aid:
- Your student’s cost of attendance (COA). The COA is an estimate of tuition and fees, room and board, books and supplies, etc.
- Your SAI. The SAI is based on a unique formula that involves your family’s taxed and untaxed income, assets, and benefits, family size, and only includes the student in college regardless if others are attending. [viii]
The financial aid office will subtract the SAI from the COA to determine the amount of need-based financial aid your student needs and how much they can receive.
Consult Your Financial Professional
Your financial professional can help you fill out the FAFSA and answer any questions you might have. In addition, they can help you design a strategy for funding your students’ higher education.
Important Disclosures
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.
All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy. TNcab.tnsos.gov
Sources:
[viii]How Financial Aid Is Calculated | Federal Student Aid
This article was prepared by Fresh Finance.
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