But I guess if you believe in karma, it could come back to bite you in the a$s.

The FAFSA asks for tax info in order to establish your need- the best thing is to be honest and straightforward so that you don’t end up having any problem justifying yourself later on. You do have to sign a statement on the form certifying that you’ve filled it out honestly and completely, so not reporting money that you really do have would be false, and if they did find out about it, you could have problems with your loans/aid later on. Better just to be clear up front. Unless it’s a HUGE amount of money it shouldn’t make that much of a difference in your aid package anyhow.