Parent assets reported on the FAFSA impact a student’s aid eligibility. The amount parents are expected to contribute from assets reported can be as high as 5.64% per year, with a rough average of 5%. Given this, the ability to exclude assets from the calculation of the Student Aid Index can be helpful to maximize eligibility.
These are the three scenarios where a parent is exempt from reporting parent assets.
1) Student is eligible for the Maximum Pell Grant
The FAFSA determines whether the student qualifies for the Maximum Pell Grant based on a parent’s Adjusted Gross Income (AGI) in the base year, family size and state of residence. When the parent’s AGI is at or below the threshold based on marital status and family size, the student qualifies for the Maximum Pell Grant. In this case, neither student nor parent assets will be included in the calculation of the Student Aid Index. The student is assigned a Student Aid Index (SAI) equal to $0
2025-26 FAFSA Income Limits
by marital status and family size for the lower 48 states
| Family size | unmarried parent with 2023 AGI at or below | Married parent with 2023 AGI at or below |
|---|---|---|
| 2 | $44,370 | N/A |
| 3 | $55,935 | $43,505 |
| 4 | $67,500 | $52,500 |
| 5 | $79,065 | $61,495 |
| 6 | $90,630 | $70,490 |
| 7 | $102,195 | $79,485 |
| 8 | $113,760 | $88,480 |
| For an unmarried parent, the AGI threshold is based on 225% of the 2023 federal poverty level, given family size. | For married parents, the AGI threshold is based on 175% of the 2023 federal poverty level, given family size. |
2026-27 FAFSA Income Limits
by marital status and family size for the lower 48 states.
| Family size | unmarried parent with 2024 AGI at or below | Married parent with 2024 AGI at or below |
|---|---|---|
| 2 | $45,990 | N/A |
| 3 | $56,880 | $44,240 |
| 4 | $70,200 | $54,600 |
| 5 | $82,305 | $64,015 |
| 6 | $94,410 | $73,430 |
| 7 | $106,515 | $82,845 |
| 8 | $118,620 | $92,260 |
| For an unmarried parent, the AGI threshold is based on 225% of the 2024 federal poverty level, given family size. | For married parents, the AGI threshold is based on 175% of the 2024 federal poverty level, given family size. |
2027-28 FAFSA Income Limits
by marital status and family size for the lower 48 states
| Family size | unmarried parent with 2024 AGI at or below | Married parent with 2024 AGI at or below |
|---|---|---|
| 2 | $47,588 | N/A |
| 3 | $59,963 | $46,638 |
| 4 | $72,338 | $56,263 |
| 5 | $84,713 | $65,888 |
| 6 | $97,088 | $75,313 |
| 7 | $109,463 | $85,138 |
| 8 | $121,838 | $94,763 |
| For an unmarried parent, the AGI threshold is based on 225% of the 2025 federal poverty level, given family size. | For married parents, the AGI threshold is based on 175% of the 2025 federal poverty level, given family size. |
2) Parent’s income is less than $60,000
There are two parts to this qualification.
- The parent’s combined AGI (Adjusted Gross Income) is less than $60,000.
- The parent filing taxes must also meet additional criteria beyond the income threshold, filing what is considered a simplified return. In this case, the parent must not file Schedules A, B, D, E, F, or H or not file a Schedule C with net business income greater than $10,000 of either loss or gain.
3) Anyone in the student’s family qualified for a means-tested Federal benefit program
If any member of the student household qualified for a means-tested federal benefit at any time in the two years prior to receiving financial aid, the parent is exempt from reporting assets. For example, the years counted for the 2025-26 FAFSA would be 2023 and 2024.
The means-tested federal programs included are:
- Earned income tax credit (EITC)
- Federal housing assistance
- Free or reduced-price school lunch
- Medicaid
- Refundable credit for coverage under a qualified health plan (QHP)
- Supplemental Nutrition Assistance Program (SNAP)
- Supplemental Security Income (SSI)
- Temporary Assistance for Needy Families (TANF)
- Special Supplemental Nutrition Program for Women, Infants and Children (WIC)
Exceptions to these rules
These rules to exempt Parent Asset reporting do not apply if:
- the parent lives outside of the US, even when they file US taxes.
- the parent does not file US taxes unless they don’t file because their income is below the filing threshold.
In both cases above, the parent must still report parent assets.