This guidance is specific to the 2024-25 award year and later. For 2023-24* award year guidance see AskRegs Q&A, Can an Exchange Student Be Included In Household Size?
Scenario: The dependent student's parents are housing an exchange student from August through July of the award year. They have included this individual in the family size.
Answer: An exchange student is not automatically excluded from being included in the family size simply as a result of participation in the exchange program.
Starting with the 2024-25 award year, family size is based on federal tax information (FTI) transferred directly from the IRS to the FAFSA via the FUTURE Act Direct Data Exchange (FA-DDX). This means the number of dependents in the family size is now based on the number of individuals who are claimed as dependents on either the applicant’s (if independent) or parent’s (if dependent) U.S. federal tax return. During FAFSA completion, students and/or parents are given the opportunity to manually update the family size if it has changed since filing the applicable tax return, e.g., to add the exchange student, if certain criteria are met. See AskRegs Knowledgebase Q&A, Who Is Included In Family Size Starting In 2024-25?
You can seek additional information about the exchange program from the parents, or from the program itself, regarding the financial commitment of the host parents to the student's participation in the exchange program. If the exchange student's home family is required to provide 50 percent or more of the student's financial support during the time the student participates in the exchange program, the host family would not be able to include the exchange student in the family size. If, however, the host family agrees to provide the exchange student's financial support during participation in the program, additional criteria must be considered before including the exchange student in the family size.
In this scenario, the exchange student would not likely meet the criteria for inclusion in the parents' family size because of the additional criteria that must be met. Those criteria require:
Per the scenario, the exchange student will reside with the applicant's family from the period from August to July of the award year, which would disqualify the exchange student from being included under the second bullet point above. If circumstances warrant, professional judgment (PJ) could be exercised to include the exchange student in the family size. If the aid applicant has been selected for verification, that process must first be completed before adjusting family size. If PJ is exercised, be certain to maintain documentation of the situation and the rationale for making the decision.
Student Aid Reference Desk: For additional information, try the Student Aid Reference Desk. It is a central hub of all the important financial aid resources you need with direct links to legislation, regulation, Dear Colleague Letters, and other ED and NASFAA references. It is updated on a rolling basis with the latest news and changes.
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