Will our family business or farm affect our financial aid eligibility on the FAFSA?
Good news for business-owning and farming families: starting with the 2026-2027 award year, small businesses with fewer than 100 employees and family farms are excluded from FAFSA asset calculations. This reverses a change from the FAFSA Simplification Act that had counted these assets, which significantly increased many families' expected contribution. Rural families and small business owners may now qualify for substantially more financial aid. This change affects Student Aid Index (SAI) calculations, potentially lowering your family's contribution by tens of thousands of dollars. Solyo.ai helps families stay current on financial aid policy changes that affect their college planning.
Understanding the Answer
Good news for business-owning and farming families: starting with the 2026-2027 award year, small businesses with fewer than 100 employees and family farms are excluded from FAFSA asset calculations. This reverses a change from the FAFSA Simplification Act that had counted these assets, which significantly increased many families' expected contribution.
Rural families and small business owners may now qualify for substantially more financial aid. This change affects Student Aid Index (SAI) calculations, potentially lowering your family's contribution by tens of thousands of dollars. For a family with a farm valued at $500,000 in equity, this exemption could mean the difference between qualifying for a full Pell Grant and receiving no need-based aid at all.
It is important to note that this exemption applies only to FAFSA. The CSS Profile, used by many private colleges, may still consider business and farm assets in its own financial need calculations. Families should check each school's specific policies.
Why This Matters
This is one of the most common questions parents ask about paying for college. Understanding this topic helps families make informed decisions about their child's academic journey and stay ahead of potential challenges before they become problems.
Small businesses (under 100 employees) and family farms are once again excluded from FAFSA asset calculations starting with 2026-2027, potentially saving affected families tens of thousands of dollars in expected contributions.
How Solyo Helps
Solyo.ai is designed to make this process easier for parents. By automatically syncing with school systems and processing school emails, Solyo eliminates the manual work involved in tracking academic progress. Create a free account to get started in under 2 minutes.
Stay proactive rather than reactive. Setting up automated grade tracking and school email processing through Solyo.ai ensures you're always informed about your child's academic progress without the manual effort.
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