20 USC 1087vv - Definitions

As used in this part:
(a) Total income 

(1) Except as provided in paragraph (2), the term total income is equal to adjusted gross income plus untaxed income and benefits for the preceding tax year minus excludable income (as defined in subsection (e) of this section).
(2) No portion of any student financial assistance received from any program by an individual, no portion of a national service educational award or post-service benefit received by an individual under title I of the National and Community Service Act of 1990 [42 U.S.C. 12511 et seq.], and no portion of any tax credit taken under section 25A of title 26, shall be included as income or assets in the computation of expected family contribution for any program funded in whole or in part under this chapter.
(b) Untaxed income and benefits 
The term untaxed income and benefits means

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(1) child support received;
(2) welfare benefits, including assistance under a State program funded under part A of title IV of the Social Security Act [42 U.S.C. 601 et seq.] and aid to dependent children;
(3) workmans compensation;
(4) veterans benefits such as death pension, dependency, and indemnity compensation, but excluding veterans education benefits as defined in subsection (c) of this section;
(5) interest on tax-free bonds;
(6) housing, food, and other allowances (excluding rent subsidies for low-income housing) for military, clergy, and others (including cash payments and cash value of benefits);
(7) cash support or any money paid on the students behalf, except, for dependent students, funds provided by the students parents;
(8) the amount of earned income credit claimed for Federal income tax purposes;
(9) untaxed portion of pensions;
(10) credit for Federal tax on special fuels;

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(11) the amount of foreign income excluded for purposes of Federal income taxes;
(12) untaxed social security benefits;
(13) payments to individual retirement accounts and Keogh accounts excluded from income for Federal income tax purposes; and
(14) any other untaxed income and benefits, such as Black Lung Benefits, Refugee Assistance, railroad retirement benefits, or benefits received through participation in employment and training activities under title I of the Workforce Investment Act of 1998 [29 U.S.C. 2801 et seq.].
(c) Veteran and veterans’ education benefits 

(1) The term veteran means any individual who
(A) has engaged in the active duty in the United States Army, Navy, Air Force, Marines, or Coast Guard; and
(B) was released under a condition other than dishonorable.
(2) The term veterans education benefits means veterans benefits the student will receive during the award year, including but not limited to the following:
(A) Title 10, chapter 2: Reserve Officer Training Corps scholarship.
(B) Title 10, chapter 106: Selective Reserve.
(C) Title 10, chapter 107: Selective Reserve Educational Assistance Program.
(D) Title 37, chapter 2: Reserve Officer Training Corps Program.
(E) Title 38, chapter 30: Montgomery GI Billactive duty.
(F) Title 38, chapter 31: vocational rehabilitation.
(G) Title 38, chapter 32: Post-Vietnam Era Veterans Educational Assistance Program.
(H) Title 38, chapter 35: Dependents Educational Assistance Program.
(I) Public Law 97376, section 156: Restored Entitlement Program for Survivors (or Quayle benefits).
(J) Public Law 96342, section 903: Educational Assistance Pilot Program.
(d) Independent student 
The term independent, when used with respect to a student, means any individual who
(1) is 24 years of age or older by December 31 of the award year;
(2) is an orphan or ward of the court or was a ward of the court until the individual reached the age of 18;
(3) is a veteran of the Armed Forces of the United States (as defined in subsection (c)(1) of this section) or is currently serving on active duty in the Armed Forces for other than training purposes;
(4) is a graduate or professional student;
(5) is a married individual;
(6) has legal dependents other than a spouse; or
(7) is a student for whom a financial aid administrator makes a documented determination of independence by reason of other unusual circumstances.
(e) Excludable income 
The term excludable income means
(1) any student financial assistance awarded based on need as determined in accordance with the provisions of this part, including any income earned from work under part C of subchapter I of chapter 34 of title 42;
(2) any living allowance received by a participant in a program established under the National and Community Service Act of 1990 [42 U.S.C. 12501 et seq.];
(3) child support payments made by the student or parent; and
(4) payments made and services provided under part E of title IV of the Social Security Act [42 U.S.C. 670 et seq.].
(f) Assets 

(1) The term assets means cash on hand, including the amount in checking and savings accounts, time deposits, money market funds, trusts, stocks, bonds, other securities, mutual funds, tax shelters, qualified education benefits (except as provided in paragraph (3)), and the net value of real estate, income producing property, and business and farm assets.
(2) With respect to determinations of need under this subchapter and part C of subchapter I of chapter 34 of title 42, other than for subpart 4 of part A of this subchapter, the term assets shall not include the net value of
(A) the familys principal place of residence;
(B) a family farm on which the family resides; or
(C) a small business with not more than 100 full-time or full-time equivalent employees (or any part of such a small business) that is owned and controlled by the family.
(3) A qualified education benefit shall not be considered an asset of a student for purposes of section 1087oo of this title.
(4) In determining the value of assets in a determination of need under this subchapter and part C of subchapter I of chapter 34 of title 42 (other than for subpart 4 of part A of this subchapter), the value of a qualified education benefit shall be
(A) the refund value of any tuition credits or certificates purchased under a qualified education benefit; and
(B) in the case of a program in which contributions are made to an account that is established for the purpose of meeting the qualified higher education expenses of the designated beneficiary of the account, the current balance of such account.
(5) In this subsection:
(A) The term qualified education benefit means
(i) a qualified tuition program (as defined in section 529 (b)(1)(A) of title 26) or other prepaid tuition plan offered by a State; and
(ii) a Coverdell education savings account (as defined in section 530 (b)(1) of title 26).
(B) The term qualified higher education expenses has the meaning given the term in section 529 (e) of title 26.
(g) Net assets 
The term net assets means the current market value at the time of application of the assets (as defined in subsection (f) of this section), minus the outstanding liabilities or indebtedness against the assets.
(h) Treatment of income taxes paid to other jurisdictions 

(1) The tax on income paid to the Governments of the Commonwealth of Puerto Rico, Guam, American Samoa, the Virgin Islands, or the Commonwealth of the Northern Mariana Islands, the Republic of the Marshall Islands, the Federated States of Micronesia, or Palau under the laws applicable to those jurisdictions, or the comparable tax paid to the central government of a foreign country, shall be treated as Federal income taxes.
(2) References in this part to title 26, Federal income tax forms, and the Internal Revenue Service shall, for purposes of the tax described in paragraph (1), be treated as references to the corresponding laws, tax forms, and tax collection agencies of those jurisdictions, respectively, subject to such adjustments as the Secretary may provide by regulation.
(i) Current balance 
The term current balance of checking and savings accounts does not include any funds over which an individual is barred from exercising discretion and control because of the actions of any State in declaring a bank emergency due to the insolvency of a private deposit insurance fund.
(j) Other financial assistance 

(1) For purposes of determining a students eligibility for funds under this subchapter and part C of subchapter I of chapter 34 of title 42, estimated financial assistance not received under this subchapter and part C of subchapter I of chapter 34 of title 42 shall include all scholarships, grants, loans, or other assistance known to the institution at the time the determination of the students need is made, including veterans education benefits as defined in subsection (c) of this section, and national service educational awards or post-service benefits under title I of the National and Community Service Act of 1990 [42 U.S.C. 12511 et seq.].
(2) Notwithstanding paragraph (1), a tax credit taken under section 25A of title 26 shall not be treated as estimated financial assistance for purposes of section 1087kk (3) of this title.
(3) Notwithstanding paragraph (1) and section 1087ll of this title, assistance not received under this subchapter and part C of subchapter I of chapter 34 of title 42 may be excluded from both estimated financial assistance and cost of attendance, if that assistance is provided by a State and is designated by such State to offset a specific component of the cost of attendance. If that assistance is excluded from either estimated financial assistance or cost of attendance, it shall be excluded from both.
(k) Dependents 

(1) Except as otherwise provided, the term dependent of the parent means the student, dependent children of the students parents, including those children who are deemed to be dependent students when applying for aid under this subchapter and part C of subchapter I of chapter 34 of title 42, and other persons who live with and receive more than one-half of their support from the parent and will continue to receive more than half of their support from the parent during the award year.
(2) Except as otherwise provided, the term dependent of the student means the students dependent children and other persons (except the students spouse) who live with and receive more than one-half of their support from the student and will continue to receive more than half of their support from the student during the award year.
(l) Family size 

(1) In determining family size in the case of a dependent student
(A) if the parents are not divorced or separated, family members include the students parents, and the dependents of the students parents including the student;
(B) if the parents are divorced or separated, family members include the parent whose income is included in computing available income and that parents dependents, including the student; and
(C) if the parents are divorced and the parent whose income is so included is remarried, or if the parent was a widow or widower who has remarried, family members also include, in addition to those individuals referred to in subparagraph (B), the new spouse and any dependents of the new spouse if that spouses income is included in determining the parents adjusted available income.
(2) In determining family size in the case of an independent student
(A) family members include the student, the students spouse, and the dependents of the student; and
(B) if the student is divorced or separated, family members do not include the spouse (or ex-spouse), but do include the student and the students dependents.
(m) Business assets 
The term business assets means property that is used in the operation of a trade or business, including real estate, inventories, buildings, machinery, and other equipment, patents, franchise rights, and copyrights.