Very Important Update for New and Current FAFSA Applicants in 2026-2027!

As we enter into a new year for college education, with that also comes some new changes to programs like FAFSA, which has been a praised college financial aid application system by many college students and their families. We have a very important update for you regarding FAFSA in 2026-2027 that you will want to hear about and that will be explained by our very own Jeff Boron. He recently made an appearance on the WBEN Radio Station here in Buffalo, NY, to talk about these changes. 

In this blog, we will take a look at the updates and changes coming to new and current FAFSA applicants in the 2026-2027 semester.

FAFSA Is Now Simpler for Returning Families

To speak to current FAFSA applicants who have already filled out a form and were accepted into the program, one of the new changes you will experience involves information that can be reused from one application to another. Jeff Boron, in his radio interview, noted that “they are going to pre-populate some of the data based on your submission from last year”. This will potentially reduce how much information families need to enter manually.

“They are going to pre-populate some of the data based on your submission from last year”

If you are a returning family that has multiple children, this could end up being very good for you. Parents will now be able to carry over information from one FAFSA account to another instead of just having to do it all over again to enter said information. Each student will still need all the regular required sections to be complete, but now, all the federal tax information can be transferred after a parent provides approval.

How Small-Business Owners Are Now Affected

Arguably the biggest changes that are coming to FAFSA relate to how businesses, particularly small businesses, are going to be affected. Starting soon, the net worth for a family-run business with 100 or fewer full-time employees will not be included in FAFSA’s asset calculations. Important to know, this is also based on whether the business meets the applicable family ownership and control requirements. The rules even state that they will not exclude farms if your family resides in one.

Boron highlighted that “we are going to be excluding the value, the asset value of family businesses and family farms with less than 100 employees.” If your family is one that owns a small business, you will not have to look at your business as a reportable asset on FAFSA. However, we recommend that you don’t just assume owning your business means you are free from having all business-related figures considered. 

"We are going to be excluding the value, the asset value of family businesses and family farms with less than 100 employees, and that's a big item for a lot of Western New Yorkers because we have a lot of small business owners in here, and it's always been difficult to value a small business and put it on the form"

FAFSA still takes a look at all income a business will make and uses it to calculate what your federal aid eligibility is going to be. Keep in mind, FAFSA is not your only option; there are plenty of other financial aid application programs. Some colleges differentiate from each other by using programs like the CSS Profile to determine your aid, and the rules of CSS could differ in how they treat business assets. Take time to read through all your options!

How These Changes Will Affect Pell Grants

We have written about Pell Grants recently in another blog regarding the changes happening to them when receiving scholarships, and we recommend you read that, but now these FAFSA changes will also affect your eligibility to receive them. Federal Student Aid as of right now says that the maximum Pell Grant for 2026-2027 is $7,395. This is still affected by your enrollment and eligibility. 

With these updated rules to FAFSA, foreign earned income will be factored into Pell Grant calculations and establish an SAI threshold (The Student Aid Index) that can make a student ineligible for them under the standard rules. To the point of what effect this has on scholarships, as we noted in our past blog, “students will be ineligible for Pell Grants if they received a scholarship that covers the full cost of attendance, regardless of whether they qualified.”

What We Recommend Families and Students Do Now

With all that being said, what should you do now? We have some recommendations that will fit in line with what we think is best. No matter if you’re a new or returning applicant, you must approach FAFSA carefully now. Go to our FAFSA page if you would like to learn more to get started! If you make a donation to our scholarship fund, our college planning specialists here in Buffalo and Western New York will file your college financial forms for you. 

Next, make sure you are signed up with an account on the official Student Aid government website so that students and parents can complete their appropriate sections. If you’re a parent, make sure you have all current asset information and data on hand, and your answers to the forms reflect it accurately when the FAFSA form is submitted. 

By understanding all of the new changes that are coming and the differences from what was in place before when you submit an application for FAFSA, this will make it easier for families to ensure that they avoid mistakes and hope they are being considered for the financial aid that they want to qualify for. If you have any questions about this, give us a call or reach out through our contact form! We will be in touch!