Financial Aid
Many of Northwest College of Art’s students receive financial assistance from one source or another. You need to apply for financial aid before we can tell you exactly what you will qualify for. It is the responsibility of the student to complete all forms correctly and in a timely manner. Allow at least two months for financial aid to be processed. Errors, omissions and corrections will cause delays.
A packet of materials will be mailed upon the student’s acceptance to the college. To see if you qualify for financial aid, you must complete the Free Application for Federal Student Aid (FAFSA). Please call Heidi Townsend at (360) 779-9993 or e-mail her for additional information.
Eligibility Requirements For Financial Aid
- You must be a U.S. citizen or an eligible non-citizen.
- You must be registered with the Selective Service if you are male and between 18 to 25 years of age.
- You must maintain satisfactory progress as defined by Northwest College of Art.
- You must not owe a refund on a federal grant or be in default on a federal education loan.
- You must have “financial need” as determined by the U.S. Department of Education.
Grant Programs
Academic Competitiveness Grant (ACG)
The student may apply for ACG by Completing the FAFSA. The federal grant program is only available to needy 1st and 2nd year college students who successfully completed a “qualifying rigorous course of study” in high school. For students to be eligible for ACG they must qualify for Federal Pell Grant, be a U.S. citizen (eligible non-citizens do not qualify), and attending school full-time in their 1st and 2nd years in a post-secondary degree program. ACG is a grant and, like the Pell grant, does not carry repayment provisions like loan programs.
Federal Pell Grant
The student may apply for a Federal Pell Grant by completing the FAFSA. This grant program is designed to assist needy students who desire to continue their education beyond high school. Eligibility is determined by the student’s need, the cost of education and the amount of money appropriated by Congress to fund the program. Federal Pell Grants are grants and do not carry repayment provisions like loan programs.
Federal Work Study
NCA does not currently participate in Federal Work Study.
State Grants
The Washington Higher Education Coordinating Board administers these state aid programs for resident students. Students must have applied for a Federal Pell Grant using the FAFSA form. Family income and assets are a factor for eligibility. The Washington State Need Grant and other state aid programs are available to students who qualify. NCA does not currently participate in State Work Study. For more information on State grants log onto: www.hecb.wa.gov.
Loan Programs
Federal Subsidized Stafford Loan
The Stafford Loan is a need-based loan. The federal government subsidizes the interest while you are in school. If you are eligible, you can borrow up to your full need but not more than $3,500 for the first academic year, $4,500 for the second academic year, and $5,500 for the third and fourth academic years. Repayment is deferred until six months after graduation, withdrawal, or dismissal from school.
Federal PLUS Loan
The Federal Parent Loan for Undergraduate Students (FPLUS) provides loans up to the cost of education less other financial aid to qualifying parents of undergraduate students. Repayment starts sixty days after the loan is fully disbursed. FPLUS is an option for parents of students who may not qualify for other forms of aid or to provide additional funding for those who need other assistance.
Federal Unsubsidized Stafford Loan
The Federal Unsubsidized Stafford Loan provides up to $6,000 for 1st and 2nd year students and $7,000 for 3rd and 4th year students who do not qualify for all or part of the funds available under the Federal Subsidized Stafford Loan Program. Funds from this loan program may be borrowed in addition to the funds available through the Federal Subsidized Stafford Loan. You may defer payments on this loan until six months after you graduate, withdraw, or are dismissed from the school. You are responsible for the interest accruing on an unsubsidized loan.
- You do not want to see if you qualify for need-based aid (i.e. Pell grant, State grants).
- You do not want to apply for low-interest federal education loans (i.e. Stafford, FPLUS).
- You intend to apply only for private (non-federal) education loans.
- You intend to make only tuition cash payments.
Private Loan Programs
Private loans are available through various lenders. These are flexible loan programs, which can either supplement federal programs or be used as a sole means of financing college costs. Loan limits are greater than those available for the Federal Family Education Loan Program. Private loan borrowers can defer repayment while in school at least half time. Normally, repayment begins six months after the student graduates, leaves school, or drops to less than half time. Most of the private loans offer flexible repayment terms with no repayment penalty. Students are usually required to have a creditworthy co-applicant. The following are some lenders who offer private, undergraduate education loans:
Private loans available:
- Wells Fargo—Collegiate Loan or Connection Loan
- Sallie Mae—Smart Option Student Loan
- US Bank—No Fee Loan
Loan applications are available online at the lenders’ web sites, or you may apply by phone.
Higher Education Tax Benefits
Tax Credits
The 1997 tax law introduced two tax credits, the Hope Scholarship Credit and the Lifetime Learning Credit. For the latest information check with your tax consultant or the IRS to see which specific tax credits and benefits may apply to you.
The Hope Scholarship Credit
The Hope Scholarship Credit allows taxpayers to claim a maximum credit of $1,800 (100 percent of the first $1,200 of tuition and fees and 50 percent of the next $1,200 of tuition and fees) annually for the first two years of college. The student, on whose behalf the expenses are claimed, may either be the taxpayer, the taxpayer’s spouse, or a dependent. The Hope Scholarship Credit is effective for expenses paid January 1, 1998, and later. These credits are phased out for taxpayers with adjusted gross incomes between $48,000 and $58,000 for individuals or between $96,000 and $116,000 for joint filers.
The Lifetime Learning Credit
The Lifetime Learning Credit can be claimed for higher education expenses incurred by the taxpayer, the taxpayer’s spouse, or a dependent. The Lifetime Learning Credit applies to expenses paid for academic periods beginning after June 20, 1998, and is usable for any year of school, for an unlimited number of years. In 2008, the Lifetime Learning Credit lets taxpayers claim $2,000 (20 percent of up to $10,000 paid in higher education expenses). These credits are phased out for taxpayers with adjusted gross incomes between $48,000 and $58,000 for individuals or between $96,000 and $116,000 for joint filers.
IRA Withdrawal
The new tax laws allow people under the age of 59 1/2 to withdraw money for higher education expenses from a regular IRA or Roth IRA without paying a penalty.
Limitations Per Calendar Year
An individual student can benefit from only one of the following tax breaks during a calendar year: the Hope Scholarship Credit, the Lifetime Learning Credit, or the education IRA. If taxpayers have more than one family member in college, they may use different tax breaks for different family members.
Deductions
Student Loan Interest Deduction
Students may deduct interest on all loans made for qualified higher education expenses. In addition to federal Stafford and Plus Loans, loans made by state or local governments, and loans specifically for education expenses qualify for interest deductions. Interest on a student loan can be deducted for the life of the loan. Individuals with income less than $70,000 ($145,000 if filing jointly) can deduct up to $2,500 in interest payments for qualified student loans. This deduction is available even if an individual does not itemize deductions. Like most other IRS programs, additional restrictions apply. See your tax advisor for further guidance.
Tuition Deductions
Tuition and fees paid during the year can be deducted up to $4,000 for the taxpayer, the taxpayer’s spouse or dependents who attend an eligible institution of higher education. This deduction can be claimed in place of a Hope Scholarship credit or Lifetime Learning credit, and is especially useful for taxpayers whose adjusted gross income disqualifies them from using the credits. Only Tuition and fees qualify. Room and board and other related costs are not included in this deduction.
Savings Methods
Coverdell Education Savings Accounts
The contribution limit to these savings accounts is $2,000 per
child, per year. The interest earned is invested tax free until
distribution. When you withdraw the money, you aren’t taxed
as long as you use the funds for qualified college expenses.
Higher education tuition, fees, and room and board are generally considered
valid expenses. Adjusted gross income limits are $110,000 for singles and $220,000
for married couples.
The IRS Website
The Internal Revenue Service’s website provides detailed information about the new tax laws. The above information is not viewed as tax advice or counsel, but is intended to inform you of possible options that should be discussed with your tax advisor before you make any decisions. Go to the IRS website to obtain the latest information on tax credits.