How are Expected Family Contributions (EFC) Calculated?

Expected family contributions, otherwise known as EFC, refer to the amount of money the family is expected to contribute toward the cost of college for any particular year. The formula changes from year to year and is developed by the federal government to determine a student's need for financial aid.

The EFC is subtracted from the Cost of Attendance or COA to estimate how much financial aid a student will need to attend college for the year. The cost of attendance includes tuition, housing and food allowances, and book allowances for the entire year. The EFC is calculated using one of three formulas depending on the student status. 

Where does the data for the EFC calculations come from?

The data used to calculate the EFC each year comes from the Free Application for Federal Student Aid, otherwise known as a FAFSA. This document is filled out each year and collects information about the family size, income, and assets of the student.

Simplified calculations are available for dependent students whose families receive federal assistance or are eligible to receive a tax return and make $49,999 per year or less. The same is true for independent students if the student and the spouse meet the same qualifications. The simplified formula does not use asset information.

Formula A: The Dependent Student

This formula applies to a student who is under age 24, not married, and can otherwise be claimed on his parent’s tax return. 

The formula uses the parents’ adjusted gross income, with the taxable income, along with the untaxed income and benefits to determine the parent’s total income. Once the income is calculated, the formula looks at allowances against the income, such as federal and state taxes paid, social security allowances for both parents, income protection allowance, employment expense allowance, and contributions from assets. The allowances are subtracted from the income to determine the available income which is then added to the asset contribution and divided by the total number of students enrolled. The family’s home is not included in the assets.

Formula B: Independent Student without Dependents Other than a Spouse

This formula applies to a student who is either married or over age 24 and does not have any children or any dependents. It follows the same formula as above, using only student and spouse income, rather than parents.

Formula C: Independent Student with Dependents Other than a Spouse

This formula applies to a student who is either single or married, but has dependents, such as children. It follows the same formula as the others, with the exception of credit for the dependents other than the spouse.

Qualifications for an Automatic Zero EFC 

For 2008-2009 school years, an automatic zero EFC is granted when both of the following scenarios are true:

  • Anyone in the parent’s household size received federal benefits such as food stamps, free or reduced lunch, SSI, TANF, or WIC.
  • The parents are eligible to file a 2007 tax return, or did not have to file, and the parent’s income is less than $20,000.

This does not apply to single or married students without dependents other than a spouse.


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