When a dependent student is the primary wage-earner for a family, they often qualify for less aid than they deserve. FM was changed in 2000-01 to allow a parent's negative adjusted available income to offset the student's income in recognition of this. However, any excess income is assessed at the student's rate (50%) and not at the bracketed rates used for parents (22% to 47%). Although the excess is theoretically discretionary income, realistically it goes to paying for family expenses, including the student's college education. In effect, the student is being penalized for being the primary wage-earner for his or her family, receiving as much as $5,000 less aid than students with a parent as the primary wage-earner.

This problem is especially prevalent among students with a disabled parent, lower income students, and first generation college students.

Unfortunately, financial aid administrators cannot shift the income from the student to parent, not even if the student gives money to the parent every month, since the authority to do professional judgment specifically excludes changes in the formula. On the other hand, the school should consider whether the student might actually be independent by virtue of having a dependent other than a spouse, namely his or her parents. Financial aid administrators should review the situation to verify whether the student's checking "no" for "dependent other than a spouse" was accurate. When a student is a primary wage-earner, it is often the case that they support the parents. The criteria are for "other persons (except a spouse) who both live with and receive more than half their support from the student". If the student provides more than half the support of at least one parent and the parent lives with the student, then the student has a dependent other than a spouse and is automatically independent. It is irrelevant that the "other person" is a parent. It is also irrelevant whether the parent provides the home, except to the extent that the fair market rental value is considered when making a determination of 50% support. Many students who are primary wage-earners fail to realize that they should check "yes" for the "dependent other than a spouse" question.

Note that this is a correction to the application and not a dependency override. No dependency override is necessary (and one would not be possible, in any event), because if the student provides more than 50% support of at least one parent or sibling, the student is automatically independent.

The school should also use professional judgment to make all available adjustments for unusual circumstances, such as disability-related expenses. Colleges should also consider establishing special scholarships for students in these situations.