With all due respect there is a big difference between parents who
divorce and a parent having his/her parental rights terminated, which is a legal procedure requiring a court ruling.
In a divorce situation there may be a division of custody, but not
termination of a parent's rights. Termination of parental rights is
generally the result of abanodonment, abuse, or neglect and should not
be confused with divorce situations or "deadbeat parents" who still have
a legal responsibility to support the child.
If a parent's rights have been terminated by the court, either voluntary release by the parent or through other court proceedings, the parent has no legal right or financial responsibility to the child.
Therefore, their income shouldn't be considered, since by law they are no longer a parent to the child.
In summary, while it *seems* most colleges would not use both parents' income, they can-as expressed here:
There is no answer. Instead, my advice: "he who gives the money makes the rules...."
So regardless of "legal" rights, a college can do what they want in asking for any information from a student's parents, custodial or non-custodial, biological or non-biological.
Think of it this way. If a wealthy billionaire decides to get divorce from his stay-at-home wife BEFORE the student's senior year of high school, they=would get lots of financial aid. Is that fair?
That is why many private colleges (who require PROFILE) will ask for non-custodial information.