1. EFC Calculation: When will I ever use this?
TASFAA 2019

2. TASFAA 2019 Jennifer Buckles Director of Financial Aid
University of TN at Chattanooga
11 years experience in Financial aid
“My introduction to calculating EFC’s was for an audit a month into my financial aid career. That foundational knowledge has been invaluable throughout my career.”
TASFAA 2019

3. TASFAA 2019 What is the EFC? Formulas SNT and Auto Zero
Agenda
What is the EFC?
Formulas
SNT and Auto Zero
EFC Formula Worksheets
Now you try!
Questions
TASFAA 2019

4. TASFAA 2019 What is an EFC? Estimated Family Contribution
An EFC is the calculated number determined based on information reported on the FAFSA®
The EFC along with other data is used by the school to determine a student’s financial aid package
The EFC is the result of the Needs Analysis Formula as prescribed in Part F of the Higher Education Act of 1965 (HEA)
TASFAA 2019

5. What is an EFC?
Determines eligibility for Pell and other need based awards
Not “Expected” family contribution but “Estimated”
Can’t be directly adjusted but elements can be adjusted through Professional Judgement
TASFAA 2019

6. TASFAA 2019 What is an EFC? EFC assumptions
Modest allowances for standard of living
Postsecondary education is among the family’s first discretionary expenses
Living allowances
12 months for the family (parents’ portion of EFC calculation), and
3 months for the student (remaining 9 months in COA)
TASFAA 2019

7. TASFAA 2019 EFC Formulas Basic EFC formulas
➔ Dependent students (Formula A)
➔ Independent students without dependents (Formula B)
➔ Independent students with dependents (Formula C)
TASFAA 2019

8. TASFAA 2019 EFC Formulas Special calculations
➔ Simplified formula (no assets) – meet simplified needs test (SNT)
➔ Automatic zero EFC – meet Auto Zero threshold
➔ Other than nine-month enrollment
TASFAA 2019

9. Simplified Needs Test (SNT)
Dependent
If tax filer, parent’s adjusted gross income is $49,999 or less
If non tax filer, parent’s income is $49,999 or less
And at least one of the following:
Anyone in parent’s household eligible for federal means-tested benefit, or
Parent is a dislocated worker, or
Parents filed or were eligible to file a 1040A/1040EZ, filed a 1040 but were not required to do so, or were not required to file any income tax return
TASFAA 2019

10. Simplified Needs Test (SNT)
Independent
If tax filer, student’s (and spouse) adjusted gross income is $49,999 or less
If non tax filer, student’s (and spouse) income is $49,999 or less
And at least one of the following:
Anyone in student’s household eligible for federal means-tested benefit, or
Student is a dislocated worker, or
Student filed or was eligible to file a 1040A/1040EZ, filed a 1040 but was not required to do so, or was not required to file any income tax return
TASFAA 2019

11. Auto-Zero for
Same requirements as SNT except income threshold is less than $25,000
For independent students, those without dependents other than a spouse cannot receive an Automatic Zero EFC
TASFAA 2019

12. EFC Formula Worksheets
18-19 EFC Formula Guide:
18-19 Financial Aid Handbook, Application and Verification Guide, Chapter 3:
18-19 EFC Formula Table Federal Register Notice
TASFAA 2019

13. EFC Formula Worksheets
6 worksheets- determine which formula and whether the SNT is met
Formula A
Formula B
Formula C
Regular
Simplified
TASFAA 2019

14. TASFAA 2019 Example Suzie Student 1. Dependent or Independent? 2. AGI?
3. Which formula? A, B or C?
4. Simplified or Regular?
TASFAA 2019

15. TASFAA 2019

16. TASFAA 2019

17. TASFAA 2019

18. TASFAA 2019

19. TASFAA 2019

20. TASFAA 2019

21. TASFAA 2019

22. TASFAA 2019

23. TASFAA 2019

24. TASFAA 2019

25. TASFAA 2019

26. TASFAA 2019

27. TASFAA 2019

28. TASFAA 2019

29. What’s the EFC?
TASFAA 2019

30. What’s the EFC?
5569
TASFAA 2019

31. Observations & Questions
TASFAA 2019