There have been several long-standing concerns about the length and complexity of the Free Application for Federal Student Aid (FAFSA). As a result, Congress passed legislation to simplify the 2024-25 FAFSA application process for students and their families.

The FAFSA Simplification Act (FSA) passed by Congress as part of the Consolidated Appropriations Act of 2021 represents a significant overhaul of the underlying processes and methodologies for determining federal student aid eligibility.

How will the FAFSA Simplification Act Affect You? Your Financial Aid Office has outlined some of the critical changes below.

1. Historically, the FAFSA has been available Oct. 1 each year. However, because of the significant changes to the application and the rebuild of the FAFSA processing system, the 2024-25 FAFSA will not be available until sometime in December 2023. Updates on an exact date will be posted to https://www.ship.edu/paying/financial-aid/2024-2025-fafsa-changes2/.

2. The FAFSA will be much shorter and more user-friendly. The FAFSA currently asks over 100 questions but will decrease to about three dozen. In addition, the wording of the questions will be updated to make them easily understood.

3. The FAFSA will be available in more languages. Currently, the FAFSA is only available in English and Spanish. The 2024-25 application will be expanded to include the 11 most common languages spoken by English learner students and their parents.

4. Applicants will be required to use the IRS (Internal Revenue Service) Direct Data Exchange. Previously, applicants had the option to enter their tax information manually or use the IRS Data Retrieval Tool (DRT). Beginning with 2024-25, all persons on the FAFSA must provide consent for the Department of Education to receive tax information or confirmation of non-filing tax status directly from the IRS. In a very number of cases, students and families will have to enter their tax data manually, but for the most part, that data will be automatically transferred into the FAFSA.

5. The term Expected Family Contribution (EFC) will now be known as the Student Aid Index (SAI). The EFC is an index number that colleges use to determine a family’s financial need. The term has often been misleading and confusing to families, as it implies that it is either the amount of money a family will have to pay for college or the amount of aid they will receive. The hope is that the new term will help clarify that this number is not the amount that families should or must pay, but rather a number used to assess their financial need.

6. Most financial aid comes from the federal government, and the vast majority of it is awarded through the Pell Grant Program. It is also the main federal grant that is geared toward students who have an exceptional financial need. The FSA amendments will use the adjusted gross income (AGI) in addition to the SAI to determine eligibility for Pell Grant award amounts.

For additional information related to the 2024-25 FAFSA Simplification Act, please visit the Financial Aid website at https://www.ship.edu/paying/financial-aid/2024-2025-fafsa-changes2/.

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