A new FAFSA problem could keep families waiting longer for financial aid awards

Apr 1, 2024, 1:04 PM

Students on the University of Pennsylvania campus in Philadelphia on December 8, 2023.
Mandatory Cr...

Students on the University of Pennsylvania campus in Philadelphia on December 8, 2023. Mandatory Credit: Michelle Gustafson/Bloomberg/Getty Images via CNN Newsource

Washington (CNN) — The Department of Education has found another problem impacting some college financial aid forms that could further delay students’ aid awards, leaving them in limbo as they decide where to enroll next year.

The problem involves tax data transferred from the Internal Revenue Service and impacts “fewer than 20%” – or potentially about 1 million – of the FAFSA (Free Application for Federal Student Aid) forms previously submitted by students and families this year, the department said Saturday.

It’s possible that colleges received inaccurate information about some families’ finances after those applicants submitted the FAFSA to the Department of Education.

The new error is the latest complication with this year’s FAFSA process, which has been marked with delays and glitches after a long-awaited, updated version of the financial aid form was released. Just over a week ago, the department identified a separate calculation error impacting several hundred thousand forms.

Students and families typically receive information from colleges in March about how much financial help they’ll receive the following academic year, but many are still waiting to receive that information.

Colleges and universities usually request students to make a decision to enroll and pay a deposit by May 1. Many schools, but not all, have already pushed back that date.

That leaves students awaiting important information about how much college will cost next year and whether they can afford to attend their school of choice.

“We recognize how important it is for schools and families to have the information they need to package and receive aid offers,” the Education Department said in the notice posted Saturday.

“Accordingly, we will continue our joint efforts with IRS to resolve these issues and implement updates to resolve data inaccuracies as expeditiously as possible,” it said.

Problems with this year’s FAFSA

Late last year, the Department of Education unveiled major changes to the FAFSA, as required by law. The new version is shorter, simpler and is expected to make more students eligible for financial aid – like federal Pell grants and loans, as well as college grants and scholarships.

The Department of Education was required to release the new version by the end of 2023, and while it met that deadline, the form was only available sporadically, for about 30 minutes at a time, for the first two days. It was not made available 24 hours a day, seven days a week until January 8.

Usually, the form is available on October 1, so this year’s application process was delayed from the start.

Later in January, the Department of Education made a last-minute fix to tie the new financial aid calculation to the latest inflation data. The adjustment made $1.8 billion more in financial aid available to students but also slowed down FAFSA processing.

At that point, the department said that it wouldn’t start sending students’ FAFSA information to colleges until the first half of March – more than a month later than expected and about the same time schools already want to have financial aid letters out the door to students.

Meanwhile, students and families have experienced a number of glitches with the new form. At first, parents who don’t have Social Security numbers had problems starting a form for a student or contributing to one their child already started – even though they should be allowed to create an account with Federal Student Aid and access the form.

Applicants who need to make a change or correction to a FAFSA form they already submitted have not been able to do so yet, which could further delay the correct financial information getting to the school of their choice.

The Department of Education has been facing criticism from lawmakers on both sides of the aisle for the delays, and the Government Accountability Office has started an investigation into the new form’s implementation.

In February, the department announced several new steps it was taking to help colleges process the new FAFSA forms and develop student aid awards.

How the FAFSA has changed

The FAFSA has long been due for an update, and the new version released at the end of last year is a culmination of changes approved by Congress in 2019 and 2020.

In previous years, the FAFSA could be as long as 108 questions. With the new form, some applicants have to answer as few as 18 questions, which takes less than 10 minutes to complete, according to the Department of Education. Some information is now directly taken from a filer’s tax return so that the applicant doesn’t have to hunt down numbers on old tax returns.

The Department of Education estimates that 610,000 more students will qualify for a Pell grant on an annual basis. The Pell grant program is a key way the federal government helps students from low-income families go to college by providing eligible students with money they don’t have to pay back.

And an estimated 1.5 million more students will be eligible for the maximum Pell grant amount, which typically changes each year. The Pell grant is worth up to $7,395 for the 2024-25 school year.

The-CNN-Wire™ & © 2024 Cable News Network, Inc., a Warner Bros. Discovery Company. All rights reserved.

KSL 5 TV Live

National News

Speaker of the U.S. House of Representatives Mike Johnson (R-LA) attends a news conference at Colum...

Haley Talbot, Lauren Fox and Clare Foran, CNN

Johnson calls on Columbia University president to resign during tense news conference

House Speaker Mike Johnson called on Columbia University’s president to resign Wednesday during a tense news conference.

9 hours ago

A Ford sign is shown at a dealership in Springfield, Pa., Tuesday, April 26, 2022. Ford is recallin...

Chris Isidore, CNN

Ford just reported a massive loss on every electric vehicle it sold

Ford’s electric vehicle unit reported that losses soared in the first quarter to $1.3 billion, or $132,000 for each of the 10,000 vehicles it sold in the first three months of the year, helping to drag down earnings for the company overall.

10 hours ago

Mandatory Credit:	Mario Anzuoni/Reuters via CNN Newsource
Dateline:	LOS ANGELES, February 04, 2024...

Lisa Respers France, CNN

Taylor Swift’s elementary school teachers remember her as a young star

Turns out Taylor Swift doesn’t just speak now when it comes to writing, but has long had a reputation for being fearless.

13 hours ago

A Planned Parenthood sign is seen at a facility in Austin, Texas, Monday, Aug. 14, 2023. A federal ...

Jacques Billeaud and Jonathan J. Cooper, Associated Press

Arizona House advances a repeal of the state’s near-total abortion ban to the Senate

A proposed repeal of Arizona’s near-total ban on abortions has won approval from the state House.

13 hours ago

The Biden administration issued final rules Wednesday to require airlines to automatically issue ca...

David Koenig, AP Airlines Writer

Airlines will now be required to give automatic cash refunds for canceled and delayed flights

The Biden administration is setting new rules on airline fees and refunds. The Transportation Department said Wednesday that the final rules will spell out exactly when consumers are owed a refund for a delayed flight.

14 hours ago

Congress finalized legislation on April 23 that could lead to a nationwide TikTok ban, escalating a...

Brian Fung, CNN

Biden just signed a potential TikTok ban into law. Here’s what happens next

President Joe Biden signed a bill Wednesday that could lead to a nationwide TikTok ban, escalating a massive threat to the company’s US operations.

16 hours ago

Sponsored Articles

Women hold card for scanning key card to access Photocopier Security system concept...

Les Olson

Why Printer Security Should Be Top of Mind for Your Business

Connected printers have vulnerable endpoints that are an easy target for cyber thieves. Protect your business with these tips.

Modern chandelier hanging from a white slanted ceiling with windows in the backgruond...

Lighting Design

Light Up Your Home With These Top Lighting Trends for 2024

Check out the latest lighting design trends for 2024 and tips on how you can incorporate them into your home.

Technician woman fixing hardware of desktop computer. Close up....

PC Laptops

Tips for Hassle-Free Computer Repairs

Experiencing a glitch in your computer can be frustrating, but with these tips you can have your computer repaired without the stress.

Close up of finger on keyboard button with number 11 logo...

PC Laptops

7 Reasons Why You Should Upgrade Your Laptop to Windows 11

Explore the benefits of upgrading to Windows 11 for a smoother, more secure, and feature-packed computing experience.

Stylish room interior with beautiful Christmas tree and decorative fireplace...

Lighting Design

Create a Festive Home with Our Easy-to-Follow Holiday Prep Guide

Get ready for festive celebrations! Discover expert tips to prepare your home for the holidays, creating a warm and welcoming atmosphere for unforgettable moments.

Battery low message on mobile device screen. Internet and technology concept...

PC Laptops

9 Tips to Get More Power Out of Your Laptop Battery

Get more power out of your laptop battery and help it last longer by implementing some of these tips from our guide.

A new FAFSA problem could keep families waiting longer for financial aid awards