student loans-husband did not receive W2, how to handle FASFA

[frolick16]

I married in October of this year, my husband was employed fro January 2009 until May 2009 in construction. The subcontractor that hired him did not send W2's and his pay stubs (the ones he could find) do not list YTD earnings, he does currently receive unemployment as he was laid off in May. I have filed my taxes separately and he filed for an extension as he hopes to locate his previous employer and get his W2's. His friend, who was also employed by the same person, is experiencing the same situation. What should I do as far as my FASFA is concerned?

[4evermom]

Was your husband considered an independent contractor rather than an employee? If so, no taxes were taken out of his pay and he would not have been sent a W2 but he should have been sent a 1099-MISC from the person who paid him.

[frolick16]

No, he was considered an employee. The assumption being made at this point is his employer kept the amount deducted from pay and did not report that amount as taxes from income. Employer is currently MIA. I thought because he receives unemployment, the government must have based the amount off of something, correct? (obviously our finances were separate until October and I readily admit to knowledge deficits regarding the unemployment process and lack of initiative to educate myself due to time constraints) Could we use those figures as the total amount of income earned?

[4evermom]

Hmm... I think I'd call the IRS and ask for suggestions. Yeah the unemployment got their figures from something so that's a good lead. They might not have a record of how much taxes were withheld. I don't really have a clue about that. What a PIA! Good luck.

[RollerCoasterMama]

Seriously PITA! Definitely get in touch with the IRS. The problems will be bigger than your FAFSA if you don't get them sorted out!

[frolick16]

Trust me, I know...the whole process is getting me discouraged!

[RollerCoasterMama]

Can you call the FAFSA people this week and ask them what appropriate ways to estimate income are when you're missing documentation? If you're in a pinch for time, that might be the fastest way.

[frolick16]

That is what I am going to do, because who knows how long this process is going to take. I wish they gave you and option to keep my finances completely separate from DH...since that is basically what we do in the rest of our lives, with the exception of him being the primary bill payer, and we have no cc debt.

[Austin'smom]

Unfortunately I've seen this situation several times this year. I would advise him to visit the local IRS office, they will be able to look up and see if the employer filed a W-2 for him and he just didn't receive it for some reason. If they haven't filed one he can use his bank statements or pay check stubs to document his income to file his taxes which then he can use for FASFA. If he uses the other information or an estimate and ends up recieiving a W-2 for a different amount at some point in the future an ammended return could be filed. Don't let the company cause problems for you with the IRS.

[frolick16]

That seems to be the consensus. I called my financial aid officer to alert her to the situation and will proceed with the information we do have. Bleech!

[K1329]

A word of caution... if his total income for 2009 was over around 7500? (Check the irs site for minimum filing requirements) he will be required to file a tax return before you can receive student aid, IF FAFSA selects you for verification, or, if your school does 100% verification. If you're not sure of his total income or when he will be able to file a return, I would report his income at less than the minimum filing requirement for 2009. At our school, if a student selected for verification reports an income over the IRS minimum filing requirement, they must submit a tax return before receiving federal aid. Also, you can file your FAFSA based on estimates while you wait for your tax return to be filed. Hope this helps!