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FAFSA counts your prior-prior-year pre-tax 401K contributions as income for that year.
The benefit of 401K contributions lies in the tax deduction, plus the fact that the $18000 contribution can't later be counted among your liquid assets.

For upper-middle class folks, the marginal EFC offset is 47% for income, 12% x 47% = 5.64% for liquid assets, and 40% x 12% x 47% = 2.256% for the value of your business.

https://ifap.ed.gov/efcformulaguide/attachments/1920EFCFormu...
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