NASFAA recently received guidance from the Department of Education (ED) regarding the treatment of the new American Opportunity Tax Credit in need analysis. Since the new tax credit is in the same section of the Internal Revenue Code as the Hope and Lifetime Learning Tax Credits, it is treated the same way in need analysis -- as excludable income.
ED will update the instructions which accompany the additional financial information questions on FAFSA on the Web shortly. It is too late to correct the instructions for the paper version of the application.
Publication Date: 2/5/2010