big problem with finanial aid?

Question

last year, my school made me do a proof of income type worksheet since im a single mom under 24 to prove i am an independant student. i only worked cleaning houses here and there for cash and used my income tax return and money i had saved to live off of. still they insisted on a paystub so a person who owns a small company i know that i cleaned house for made me one, but it was never filed with the state or anything because he only payed me cash. now the school wants a W2 for this year and income tax return but of course i dont have one and dont know what to do now. i probably shuoldnt have given them that paystub since it wasnt actually payed out from his business account. should i try to explain to them or just not file for financial aid this year to avoid any further problems??

Answer 1

It appears that although last year (2005) you filed a tax return, this year you did not.

Are you independent or not? Is someone else supporting you? If that is the case, your financial aid will be affected.

If you are supporting yourself, then I suggest you file a tax return immediately, showing your cash wages. If you didn't make much money, you are denying yourself the Earned Income Credit if you have a qualifying child.

Don't review the paystub business with financial aid, that is irrelevant. File your tax return, and then file for financial aid showing your signed tax return. If you show FA what was submitted and accepted by the IRS, it should suffice for FA purposes. Whoever told you that a paystub was required doesn't know the rules.

You can still file electronically, go to a tax prep place and you can be filed and get the acceptance in one day.

Answer 2

Bimbean is way wrong when she says that if you make under $6000, it's not illegal to work under the table. The limit is really $400 where you are required to file a tax return and pay at least self-employment tax (social security and medicare) even if you don't owe any income tax, if you are working on your own and not as an employee.

If you didn't have a W-2 and didn't file taxes on your cash income, how did you have an "income tax return" (refund) to help with living expenses?

By filing false information with FAFSA or with your school, you have now opened a can of worms and made possible trouble for yourself and for the person who gave you the phony pay stub. If you're lucky the IRS won't get wind of all this. If you're just dealing with your school, they likely won't - if you are dealing with FAFSA, they might.

Answer 3

i work for a financial aid dept (in MA may be diffrent where you are) and you do NOT have to provide a w2 or tax return if you do not have one. there is a form you fill out , sometimes you can write a letter and get it noterized. that says you did not file taxes you work under the table, which is not illegal as long as you make less then $6000. and you have to state how you support yourself. ie parents help, boyfriend help.
whatever the case may be.
talk to your FA person about this and if they are no help go to there manager.
feel free to email me with any more questions ill do my best to answer them for you.
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