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Financial Planning / Paying For College


Subject:  Re: Parent vs Child Assets Date:  8/3/2001  8:56 PM
Author:  NellieD Number:  4126 of 8558

When you start accusing someone of criminal activity with absolutely nothing to back it up, then that's a bit much. From his post (and his previous posts) it looks like he had the money to pay for college and he also qualified for interest-free loans. He took the loans to pay for college, kept his money in the bank earning interest, and paid off the loan when he got out of college. There is absolutely nothing in his posts to indicate any crime whatsoever. If he lied on forms or borrowed more than the educational expenses, you could argue a crime has been committed.

When you sign your FAFSA, you sign, "Under penalty of perjury, the information I have provided is true". I'm not a CPA and I'm not going to analyze the entire scheme they cooked up, but manipulating your inventory numbers to make it look like your business has no assets is probably falling into the "not-so-true" category.

The poster specifically said:Actually, I did take out all the loans I could. (Well, the subsidized ones, anyway. I had no interest in paying interest.) Then we invested the funds in interest bearing accounts under the business name until repayment time came, at which time I paid everything back and kept the interest differential

He or she did borrow money that was not used for educational expenses and then transferred it to a business. Does that sound legal to you? Did the business declare this money as income? What do you think?

I am all for using the rules to your advantage, but if you are wealthy and obtaining need-based grants, you should know that you are taking money from people that are more needy than you. That very well may be legal. It is not ethical. You can also go and get food stamps and other public aid when you are a child of wealthy parents who has very little income of their own. Again, probably legal. Definitely unethical and definitely going against what the programs are intended for.

People complain that they are taxed too much and there's not enough money in the programs they want money from. The source of the problem and the solution lies with each and every one of us. I am comfortable with my choices.


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