In Texas, child support officially ends when a child turns 18 and graduates from high school. Without the right approach, an impending divorce has the potential to derail your child’s college education.
Securing funding can prove problematic when divorcing or divorced parents do not know or do not agree on how to proceed. Thankfully, an understanding of the road ahead can assist you in navigating the changes and ensuring your child has the financial ability to attend college. Here’s what you need to know:
Only One Parent Needs to Complete the FAFSA Form
The good news is that there is no need for the divorce to be finalized to qualify for need-based aid. If you are separated and the child lives primarily with you (more than fifty percent of the time) then when filling out the Free Application for Federal Student Aid, or FAFSA, you will only need to provide your individual income information The caveat to this is if you are receiving child support or spousal support from the noncustodial parent, you will have to include these amounts as part of your income.
The Divorce Does Not Need to Be Finalized
In Texas, you do not need to have a finalized divorce for only one parent to fill out the FAFSA, as long as you can provide proof that you and your spouse are not cohabitating in the same home. For example, college financial aid administrators may want to see proof that the parents are maintaining separate residences. When submitting the FAFSA, you might be required to submit such proof as copies of utility bills, leases or mortgage payments made for separate residences.
If you are unable to provide this type of proof, you will more than likely be required to include the other parents’ income information when filling out the FAFSA
In addition, note that you will need to repeat this process annually by the given date or your child could lose their college funding.
Official Agreements Can Ensure Mutual Parental Participation
Because there is no requirement in Texas that a parent contribute financially to a child’s education after he turns 18 and graduates from High School, it can be especially important to try and plan for your child’s college during the divorce process.
If both parties are in agreement, you can include in your divorce an agreement for college funding in addition to a child support agreement. This additional agreement can specify who is responsible for how much of the college expenses, any limits on annual payments, an age limit when the support ends whether or not the child has graduated, etc. The agreement can also define what is considered to be college costs. It can limit costs to such things as tuition, text books, room and board, transportation, health insurance, Finally the agreement can set out any requirements the child must satisfy to receive continued support such as achieving a minimum GPA and taking a minimum number of credit hours per semester.
It is important to note that if one parent or other does not abide by the agreement, that parent can possibly be sued, but only for breach of contract. Payment of this type cannot be enforced by contempt.
The payments are essentially made on an honor system, however. Unlike child support, the court will not punish nonpayment with jail time or any other repercussions if the other parent does not follow through. You can only sue for breach of contract at that point, leaving your child without funding for their college education in the meantime.
529 Accounts Can Help Both Parents Collaborate on Funding
An alternative is to reach agreements as part of the divorce that either one or both parents will contribute a certain amount per month to a 529 plan for the child’s education. Contributing a set amount per month to a 529 plan by a non-custodial parent, can limit that parent’s financial obligation and yet still help the parties build a solid college fund for the child.
In conclusion it is possible to minimize the impact of a divorce on your child’s college education. By reaching agreements during the divorce process with respect to your child’s college education, you can be confident that you are on the right path to helping your child build a bright future.