On the worksheets, you (the student) should go to www.fafsa.ed.gov and click on "Worksheets" under "Before Beginning a FAFSA" or complete the left-hand green side on page 8 of the paper FAFSA.

Question 42 - Worksheet C

Exclusions from taxed income. Because the items listed in this worksheet will be excluded from income when the Department's processor performs the EFC calculation, you should not subtract them from your responses to the income questions from Questions 32-47. These amounts should be calculated on the basis of what was received between January 1 and December 31, 2004 and not what was received during the school year.

Education credits. The Hope and Lifetime Learning tax credits benefit students or parents who pay tuition and related expenses for attendance at least half time in a degree-granting program. These tax credits are subtracted directly from the total federal tax on a tax return. Enter the total amount of Hope and Lifetime Learning credits you received in 2004, from Form 1040 — line 49 or 1040A — line 31. For more information about these tax credits, visit the IRS Web site at www.irs.gov/pub/irs-pdf/p970.pdf.

Child support payments. Report any child support payments paid during 2004 by you (or your spouse) because of divorce, separation or as a result of a legal requirement. Do not include support for children in your household, as reported in the "number in household" question on the FAFSA (Question 84 for independent students). For purposes of the FAFSA, a child is a member of your household if you provide more than half of the child's support, whether the child lives with you or not.

Taxable earnings from need-based employment programs. These are earnings from any need-based work programs including Federal Work-Study and need-based employment portions of fellowships and assistantships.

Student grants and other awards. Report any student grant and scholarship aid reported to the IRS in your AGI. This includes AmeriCorps benefits (awards, living allowances, and interest accrual payments), as well as grant and scholarship portions of fellowships and assistantships.