For the FAFSA and student loan eligibility, it is true that MFS vs. MFJ makes no difference, both spouse's income is always deemed part of the household income.
But I will tell you the news media has been all over this issue already, and it is linking the income limits announced by President Biden with income tax filing status. For example:
https://studentaid.gov/debt-relief-announcement/
"To be eligible, your annual income must have fallen below $125,000 (for individuals) or $250,000 (for married couples or heads of households)"
https://money.com/student-loan-forgiveness-who-qualifies/
"People with existing federal student loans who earn less than $125,000 a year are eligible for forgiveness. The cutoff for married couples filing jointly is $250,000."
https://www.gobankingrates.com/loans/student/what-is-student-loan-forgiveness-income-limit-for-marri...
"When it comes to married people filing jointly on taxes, the maximum income limit is $250,000 for the household."
https://www.cnbc.com/2022/08/24/heres-what-president-bidens-student-loan-forgiveness-means-to-your-t...
"Biden on Wednesday announced that he will forgive $10,000 in federal student debt for most borrowers, limited to borrowers making less than $125,000 per year, or $250,000 for married couples filing together or heads of households."
Part of the confusion is no doubt coming from the application of the existing rules of the, "income-driven repayment (IDR) plan" towards this new loan forgiveness program. That program, as I understand it, utilizes income tax filing status (MFJ vs. MFS) to determine the payment amounts, and DOE has already said that if you participate in that program, they will use the income information you provided for it to automatically determine eligibility for this loan forgiveness program. The provisions of the announcement for "Heads of Households", an income tax filing status classification, also hints that tax filing status is going to be a factor on eligibility for loan forgiveness.
Obviously, nobody is quite sure yet because this was just announced, and no rulemaking has even been proposed yet, but like the previous years economic stimulus programs, these dramatic and highly unanticipated changes suddenly awarding thousands of dollars in benefits are disruptive to orderly tax planning, and, in that respect, unappreciated.
