New York state high school students who are looking for a break for college are in luck. Governor Andrew Cuomo signed a budget bill this year that gives free college tuition to New York students attending the CUNY or SUNY schools, as long as their family’s income is not over $100,000 this year. Next year, the income cap will increase to $110,000 and $125,000 in 2019.
Those who are eligible will pay no tuition, which is roughly $6,500 at four year schools and $4,350 at community colleges. They still have to pay their student fees, room, board, and books, which can add up to $14,000 per year.
However, there are some serious loopholes that may allow people to take advantage of the system.
A student’s eligibility is based on their family income. That’s the income that the mom, dad, step parents, or custodial parents earn. The student puts that amount on the financial aid application, and that’s the figure the financial aid office uses when considering students for financial aid, Pell grants, and Stafford loans. And if there’s only one parent involved, that person’s income is the only income reported on the FAFSA application.
How Does This Affect People Getting Divorced?
When a family is going through divorce, they can add certain elements in their stipulation of settlement that can take advantage of this. For example, you could stipulate that the custodial parent will file applications for scholarships, grants, and other financial aid. This way, you can ensure the person who makes less money will be the “family income” on the FAFSA application.
For example, let’s say the husband makes $200,000 per year, and his ex-wife makes $50,000, and their daughter is living with her mom. The wife will then use her tax returns for the family income on the FAFSA, and they can flip the entire cost of college onto the state. Even if the dad were making $500,000, and the mom was making $100,000, they can game the system so mom is the one who files the application.
This what is called the Law of Unintended Consequences. The law was originally meant for poor people to go to college, and for people who make less than $125,000 per year, but it has also benefited people going through a divorce and dealing with child support.
And since child support is not taxable, even if one parent is making a fortune and has a wonderful lifestyle, and is also supporting their former spouse, New York will still foot the college bill. It doesn’t define what a family is, it relies only on the figures on the FAFSA form.
If your own family is facing a divorce or fighting for child support, the Levoritz Law Group can help families going through a divorce navigate the system as well as manage the child support process. If you would like more information, or need to talk with an attorney, please call us at (718) 942-4004.