My daughter will begin her Freshman year in college this September. She has a sister(age 22) who will graduate from college in May. She has not yet secured a job. Our 27 year old son lives with us. He currently collects unemployment and is attending college. Counting my husband and I, is our household size 3, 4 or 5?

If both your 22-year old daughter and 27-year old son receive more than 50% of their support from you then they should be counted in the household size.

Anyone in the immediate family who receives more than 50 percent of their support from a dependent student's parents or an independent student and spouse may be counted in the household size, even if that person does not reside in the house, as in the case of a sibling who is over 24-years-old but still in college and receiving the majority of their support from parents. Siblings who are dependent as of the date you apply for aid are also included, regardless of whether they receive at least 50 percent of their support from their parents. Any other person who resides in the household and receives more than 50 percent support from the parents may also be counted, such as an aunt or cousin. An unborn child who will be born during the award year may also be counted in the household size.
Household size and tax exemptions are not necessarily the same. Exemptions look at the previous year or tax year and household size refers to the school year for which the student is applying for aid.