[Oasfaa] Verification Question

[Jonna Raney]

Years ago, we treated amount on line 12 or 18 on the 1040 as zeroes. Then, we went to a training a few years ago and they specifically said to subtract negative amounts when calculating income from work.  So, we started subtracting the negative amounts.  However, a colleague at another school emailed today and had found the following in the regs...

"Income earned from work and the IRS 1040 form
The FAFSA instructs the applicant to sum lines 7, 12, and 18 of the 1040 
form and box 14 [code A] of Schedule K-1 (Form 1065) as an option for 
determining the income earned from work. But when the values of lines 12 
or 18 or box 14 are negative, this will reduce the total and can wrongly 
affect the Social Security al-lowance. If values from lines 12 or 18 or 
box 14 are negative, treat them as zero when determining the income earned"

So, now I think we need to go back to treating them as zeroes except that the FAFSA simply says to total lines 7, 12, 18 and Box 14A, etc. and doesn't instruct to treat negatives as zeroes so I'm sure most will subtract them because that's how you logically total a negative.  Right?

So, what do you do?  I can take it if everyone tells me we're doing it incorrectly.  :-) I would rather hear it from you all than from a program reviewer.

Jonna