To complete the 2025-26 FAFSA, the core document you need is your 2023 federal income tax return (IRS Form 1040), along with the W-2s, 1099s, and schedules that go with it. Beyond the tax return, gather current balances for your bank and investment accounts, records of any child support received in 2023, and documentation of any business or farm your family owns. Every person who has to provide financial information on the form — the student, a spouse, a parent, or a step-parent — needs their own set of these records.
Why 2023 and Not 2024
The 2025-26 FAFSA pulls financial data from the 2023 tax year. 1Federal Student Aid. 2025-2026 Federal Student Aid Handbook – Filling Out the FAFSA Form That return has already been filed and processed, so the numbers are settled. If you consent to the IRS direct data exchange, most of those figures transfer into the FAFSA automatically, but you still want the return in front of you to confirm everything landed correctly and to answer the questions the transfer doesn’t cover.
Who Has to Gather Documents
The FAFSA calls each person who supplies financial information a “contributor.” A contributor can be the student, the student’s spouse, a biological or adoptive parent, or a parent’s spouse. 2Federal Student Aid. Understanding the FAFSA Form Each contributor needs their own FSA ID, provides their own consent to the IRS data transfer, and completes their own section — which means each contributor has to pull together their own documents.
Step-parents are a common source of confusion. If your custodial parent remarried and filed a joint 2023 return with the new spouse, the step-parent’s information appears through that joint return and no separate contributor account is needed. If the custodial parent and step-parent filed separately, the step-parent is a separate contributor with a separate document pile. 2Federal Student Aid. Understanding the FAFSA Form
The Federal Tax Return and Its Attachments
IRS Form 1040 for 2023 is the anchor document. Adjusted gross income and federal tax paid both come from it, and both feed directly into the Student Aid Index. Alongside the 1040, keep the following within reach:
- W-2 forms from every employer during 2023, which show wages, salaries, and tips. These are essential if you are later selected for verification.
- 1099 forms covering interest, dividends, freelance work, and other non-wage payments.
- Schedule 1, which reports additional income (business earnings, rental income, alimony received) and adjustments like student loan interest and IRA contributions.
- Schedules 2 and 3, which cover additional taxes owed and additional credits or payments. These change the federal tax paid figure that flows into the aid formula.
Even if the IRS data exchange populates these fields for you, keep the paperwork. If your application is selected for verification, the school will ask for it.
Watch for IRA and Pension Rollovers
If you rolled a traditional IRA into another IRA in 2023, or moved a pension into a qualified plan, the untaxed portion of that distribution appears on your 1040 (line 4a minus 4b for IRAs, line 5a minus 5b for pensions) and the FAFSA initially captures the full amount as income. 1Federal Student Aid. 2025-2026 Federal Student Aid Handbook – Filling Out the FAFSA Form The form provides a separate field where you manually enter the rollover amount so it gets excluded from the aid calculation. Hold onto documentation showing the funds moved directly into another retirement account, because verification will ask for proof.
What the Tax Return Doesn’t Cover
Several FAFSA questions have nothing to do with your 1040. Track down these records separately.
Bank and Investment Balances
You report the balance of every checking and savings account as of the day you sign the FAFSA. Not the year-end balance, not an average — the balance on that date. Have online banking open or a current statement ready.
Investments count too: stocks, bonds, mutual funds, certificates of deposit, and the net worth of real estate you don’t live in (rental properties, vacation homes, land). 3Federal Student Aid. Current Net Worth of Businesses and Farms Your primary residence is excluded, so leave the home you live in out. Retirement accounts (401(k)s, pensions, IRAs), ABLE accounts, and the cash value of life insurance are also not reportable assets. A distribution taken from a retirement account in 2023, however, does count as income for that year.
Business and Farm Records
For 2025-26, the small-business exclusion that used to shield businesses with 100 or fewer employees is gone. Every family-owned business has to be reported regardless of size. 3Federal Student Aid. Current Net Worth of Businesses and Farms Net worth is the current fair market value of the business (land, buildings, equipment, inventory, machinery) minus debt secured by the business itself. A home equity loan used to fund the business doesn’t offset the value unless a financial aid officer grants a professional judgment adjustment.
Family farms follow the same logic. Report land, buildings, livestock, unharvested crops, and equipment; exclude the value of the principal residence if you live on the farm. 3Federal Student Aid. Current Net Worth of Businesses and Farms You will want appraisals, loan statements, and any recent valuation paperwork you can find.
Child Support Received
On the redesigned FAFSA, child support received is reported as an asset rather than as untaxed income. Whoever received the support reports the total received during 2023. 4U.S. Department of Education. FAFSA Simplification Questions and Answers Bank records or court documentation showing the amounts received will back up your entry.
Several categories of untaxed income that appeared on older FAFSA forms are no longer asked about: veterans’ non-education benefits, housing and food allowances for military personnel and clergy, and the catch-all “other untaxed income” line. 5Federal Student Aid. FAFSA Simplification Act Changes for Implementation in 2024-25 You don’t need documentation for those.
Documents for Non-Filers
If a contributor’s 2023 income fell below the IRS filing threshold and they did not file a return, they still have to complete their section of the FAFSA and consent to the IRS data check. W-2s from any 2023 employers serve as the primary income record; 1099-NEC forms cover freelance or contract work. Keep every W-2, even from short-term jobs.
If the school selects the application for verification, non-filers may need an IRS Verification of Non-Filing Letter. You can request one through your IRS online account, by calling the automated transcript line at 800-908-9946, or by mailing Form 4506-T. 6Internal Revenue Service. Get Your Tax Records and Transcripts
Documents for Foreign Income
If a contributor filed a foreign tax return for 2023, you need a signed copy of that return with every schedule. Convert all figures to U.S. dollars using the exchange rate published by the U.S. Federal Reserve closest to the date you first complete the FAFSA — not the rate on the date the income was earned, and not the rate on the foreign return. 7Federal Student Aid. How Do I Fill Out a FAFSA Form Using a Foreign Tax Return
Foreign earned income that was excluded from U.S. taxation under the foreign earned income exclusion (Schedule 1, line 8d of the 1040) is treated as untaxed income in the Student Aid Index calculation. 4U.S. Department of Education. FAFSA Simplification Questions and Answers
Identity Details and IRS Consent
The documents only work if the IRS can match each contributor to a tax record. Every contributor’s Social Security number, legal name, and date of birth must match Social Security Administration records exactly. Mismatches — a maiden name against a married name, a transposed digit — will cause the data transfer to fail and leave the FAFSA in “Action Required” status until corrected. 8Federer Student Aid. What Do I Do if My Personal Information Is Incorrect on My FAFSA Form Confirm these details for every contributor before starting.
Consent to the IRS data exchange is required, not optional. If any contributor refuses, the Department of Education cannot calculate the Student Aid Index and the student loses eligibility for federal aid. 9Federal Student Aid. 2025-26 FAFSA Form This holds even for contributors who did not file a U.S. tax return.
If You Are Selected for Verification
Some FAFSA submissions get flagged for verification, meaning the school confirms the reported figures before releasing any federal aid. An asterisk next to your Student Aid Index on the FAFSA Submission Summary means you have been selected. 10Federal Student Aid. 2025-2026 Federal Student Aid Handbook – Verification, Updates, and Corrections
Depending on which verification group applies, the school may ask for a signed copy of the 2023 tax return or an IRS tax transcript, W-2 forms, documentation of IRA or pension distributions and rollovers, proof of tax-exempt interest, verification of family size, and, for non-filers, the IRS Verification of Non-Filing Letter. The most comprehensive group (V5) also requires identity verification and a signed statement of educational purpose. 10Federal Student Aid. 2025-2026 Federal Student Aid Handbook – Verification, Updates, and Corrections Ignoring a verification request blocks disbursement and can make the student personally liable for any federal funds already released.
When 2023 Income No Longer Reflects Your Situation
Because the form looks back to 2023, families who have since lost a job, gone through a divorce, or absorbed large medical costs may find that the FAFSA overstates what they can pay. The form itself has no field for reporting this, but financial aid offices can adjust the figures through a professional judgment review. 11Federal Student Aid. How Do I Report My Family’s Special Financial Circumstances on the FAFSA Form Qualifying situations include significant income loss, high uninsured medical or dental expenses, elementary or secondary school tuition costs, and a family member’s recent unemployment.
To ask for that review, gather a written explanation and supporting evidence: a termination or separation letter, unemployment benefit statements, recent pay stubs showing reduced income, medical bills, or an updated tax return if one has been filed. Each school handles its own requests, so submit paperwork to every school where the student applied.