FAFSA & Verification Updates TASFAA Spring Conference April - - PDF document

TASFAA Spring Conference April 25-27, 2016 1 FAFSA & Verification Updates For discussion purposes only

TASFAA Spring Conference

April 25-27, 2016

FAFSA & Verification Updates

David Bartnicki U.S. Department of Education

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College List

• Issue:

FSA has received requests from public to stop sharing full list of colleges on student’s FAFSA with every school listed.

• Resolution:

ISIR sent to colleges will only include the Federal School Code and associated housing code for the school to whom the ISIR is sent.

• Applicants will continue to receive SARs that list all the Federal

School Codes selected on each transaction in order

• State grant agencies will continue to receive the full list of the

colleges but, beginning with the 2017-2018 FAFSA that listing will be provided in a random order

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TASFAA Spring Conference April 25-27, 2016 2 FAFSA & Verification Updates For discussion purposes only Guidance For Legal Guardianship

• Issue:

Applicants sometimes answer the legal guardianship question incorrectly.

• Resolution:

FAFSA question 55 has been reworded and help text has been modified.

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Legal Guardianship Messaging

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Other 2016-17 FAFSA Changes

• Income threshold for an Automatic Zero EFC

increased to $25,000

• Change tax line references in taxes paid questions
• Updated the question to read, “Enter your (and spouse’s)

income tax for 2015. Income tax amount is on IRS Form 1040—line 56 minus line 46; 1040A—line 28 minus line 36; or 1040EZ—line 10.”

• Excess Advance Premium Tax Credit Repayment and the

Health Care Individual Responsibility line items should not be included as taxes paid for Title IV purposes

• Reorder text in FAFSA questions 26, 28, 29, and 30

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TASFAA Spring Conference April 25-27, 2016 3 FAFSA & Verification Updates For discussion purposes only

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2017-2018

Paper FAFSAs

• More than 99 percent of FAFSAs are filed

electronically.

• Beginning with the 2017-2018 FAFSA we

will no longer print the FAFSA as a color packet.

• PDF FAFSA available on-line to be printed
• Call 1-800-4FEDAID to request a copy

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2017-2018 Application

• 2017-2018 Processing Announcements

– Beginning with 2017-2018, the FAFSA cycle will begin October 1 instead of January 1

• 2017-2018 FAFSA filing will begin October 1, 2016
• Gives more time to review, submit & update FAFSA data

– Beginning with 2017-2018, FAFSA income information will come from the “prior, prior year”

• 2017-2018 FAFSA will collect tax year 2015 income

information

– Added an applicant’s receipt of Medicaid as a qualification for the Simplified Needs Test (SNT)

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TASFAA Spring Conference April 25-27, 2016 4 FAFSA & Verification Updates For discussion purposes only

Questions?

FAFSA CHANGES FOR 2017-18 Early FAFSA/Prior-Prior Year: Issues

We’ve heard your concerns about….

• Outreach

– Early FAFSA Webpage (right-hand side of IFAP)

• http://ifap.ed.gov/EarlyFAFSA/indexV1.html
• Periodic EAs, DCLs, training, Resources on IFAP
• Q & As recently added

– Student websites, publications, communications will be updated appropriately and as timely as possible – "Early FAFSA" mailbox for the community to contribute thoughts, ideas, and concerns on the implementation of the 2017-2018 Early FAFSA

• "Early FAFSA" mailbox - EarlyFAFSAFeedback@ed.gov

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We’ve heard your concerns about….

• Professional Judgement (GEN-16-03)
• Reminded schools of their ability to use PJ and

encourages schools to use PJ when appropriate (and properly document)

• ED acknowledges likely increase in use of PJ
• ED will modify risk-based compliance models to

account for PJ increase

• Reminded schools to set Professional Judgment Flag

to 1 (EFC Adjustment Processed) to indicate that the CPS submission was the result of a PJ determination

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Early FAFSA/Prior-Prior Year: Issues

TASFAA Spring Conference April 25-27, 2016 5 FAFSA & Verification Updates For discussion purposes only

We’ve heard your concerns about….

• Verification
• May be some changes but overall process will be the same
• In most cases financial data processed by IRS
• Conflicting information (16/17 vs. 17/18 data)
• ED working to determine how to handle conflicting

information during transitional year (e.g. 2015 financial data)

• 2/18/16 EA encourages use of IRS DRT in 16/17 and 17/18

to reduce likelihood of conflicting information

• Further conflicting information guidance with be shared

though IFAP in the near future

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Early FAFSA/Prior-Prior Year: Issues

G-Q8: Will institutions have to review all of their students 2016-17 and 2017-2018 ISIRs to determine if there might be conflicting information since supposed to be completed using same 2015 income and tax information? G-A8: No….the Department has developed a process where CPS will review a 2016-2017 FAFSA if filed for a 17-18 applicant. CPS will flag only those 2017-2018 ISIRs where any potential conflict, could have a significant impact on the student’s 2017-2018 EFC… …The most effective ways to prevent conflicting information from

• ccurring is for the FAFSA applicant to use the IRS Data Retrieval

Tool (IRS DRT) when completing both their 2016-2017 and 2017- 2018 FAFSAs. [April 12, 2016]

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Early FAFSA/Prior-Prior Year: Q & As Early FAFSA/Prior-Prior Year: Items

Electronic Announcement #4 - March 18, 2016

• Outlines income related items on FAFSA that will

be based on 2015 data (prior-prior year)

• Tax filing status, tax return status, type of return, return

eligibility, AGI, taxes paid, exemptions, income earned from work, income exclusions, untaxed income

• FAFSA items current at time FAFSA completed or

for current award year (Not prior-prior year data)

• Dislocated worker, household size, number in college,

assets, certain means-tested benefits

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TASFAA Spring Conference April 25-27, 2016 6 FAFSA & Verification Updates For discussion purposes only

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Prior-Prior Year – What ISN’T changing…

• When Pell amounts are

finalized/announced

• When Pell charts are released
• When Pell origination/disbursement

records can be sent to COD

• When Pell funds will be available in G5
• When award letters may be sent to

students

• Sec. 482 of the HEA

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2016-17 Verification – Overview

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• Same data elements as for 2015-2016

award year

• Some modifications and clarifications to

acceptable documentation

• Eliminated Child Support Paid (V3) as a

separate verification group

• In limited circumstances, an applicant’s

Verification Tracking Group could change

TASFAA Spring Conference April 25-27, 2016 7 FAFSA & Verification Updates For discussion purposes only

2016-17 Verification - Changes

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Verification Tracking Group changes:

• Verification Tracking Group V3 (Child

Support Paid) has been removed

• Applicants placed in V1, V4, V5, and V6

must still verify child support paid if reported

• n ISIR

2016-17 Verification - Changes

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Verification Tracking Group changes:

• Applicants may be moved from previously

assigned Groups V1, V4, and V6 to Verification Tracking Group V5

– Applicant is only required to verify the additional items in V5 that were not previously verified – If the applicant is moved to Verification Tracking Group V5, no additional disbursements of any Title IV aid may be made until verification is satisfactorily completed

2016-17 Verification - Changes

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Verification Tracking Group changes:

• Applicants moved to Verification Tracking

Group V5

– If Title IV aid had been disbursed prior to receiving an ISIR with the new V5, and the applicant does not complete verification, the applicant is liable for the full amount of TIV aid disbursed for 2016-2017 – The institution is not liable

• Except school must return any Title IV funds as

required in any R2T4 calculations

TASFAA Spring Conference April 25-27, 2016 8 FAFSA & Verification Updates For discussion purposes only

Applicants moved to Verification Tracking Group V5

• Verification can be set on the application or

correction

• Verification Selection Change Flag
• Y: indicates verification was not set and now record

is selected for verification

• C: indicates the verification tracking group has

changed

– This “C” is transaction specific

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2016-17 Verification - Changes 2016-17 Verification

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Income Information for Non-IRS Tax Filers

• Tax filers who filed an income tax return with a taxing

authority in a U.S. territory (Guam, American Samoa, the U.S. Virgin Islands) or commonwealth (Puerto Rico and the Northern Mariana Islands) or with a foreign central government, must submit a copy of a transcript of their tax information

– A signed copy of the applicable 2015 income tax return that was filed with the taxing authority is only acceptable if tax filers are unable to obtain a free copy

• f a transcript of their tax information

2016-17 Verification

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Income Information for Non-IRS Nontax Filers

• Residents of the Freely Associated States

(Republic of the Marshall Islands, the Republic of Palau, the Federated States of Micronesia), and a U.S. territory or commonwealth or a foreign central government who are not required to file an income tax return under that taxing authority’s rules must submit:

– a copy of their Wage and Tax Statement (or equivalent documentation) for each source of employment income and – a signed statement identifying all of the individual’s income and taxes

TASFAA Spring Conference April 25-27, 2016 9 FAFSA & Verification Updates For discussion purposes only

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• For V4 and V5, if institution successfully verified and

documented applicant’s high school completion status for a prior award year, verification of high school completion status is not required for subsequent years

• DD Form 214 Certificate of Release or Discharge From

Active Duty may serve as alternative documentation to verify a student's high school completion if it indicates that the individual is a high school graduate or equivalent

• An institution may not accept as alternative

documentation an applicant’s self-certification

High School Completion Status

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In rare cases where it is impossible for a refugee, an asylee or a victim of human trafficking to obtain documentation of his or her completion of a secondary school education in a foreign country, an institution may accept self-certification from these applicants

• Q&A FHD-Q2/A2 (program integrity Q & A website under HSD)
• Required information included:

– Proof of attempt to obtain documentation of their completion of a secondary school education in a foreign country – Signed/dated statement that indicates applicant completed secondary school education in a foreign country along with - name and address

• f foreign high school and date foreign HS diploma was awarded

– Copy of entry status documentation showing status as a refugee, asylee, or victim of human trafficking and who entered the US after the age of 15

High School Completion Status

2016-2017 Verification

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TASFAA Spring Conference April 25-27, 2016 10 FAFSA & Verification Updates For discussion purposes only

• Contains 4 appendices to assist with crafting school

verification documents to gather verification data

• Appendix A – Suggested Text
• Not required to use ED’s suggested text and formats
• ONE EXCEPTION – institutions must use the exact

language provided in the “Statement of Educational Purpose” (Groups V4 & V5)

• “Notary’s Certificate of Acknowledgement” section, does not

require the use of the exact language provided, although it must include a copy or description of the identification presented by the applicant to the notary

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Electronic Announcement – 11/18/15

• Appendix B – Table of verification items
• Appendix C – Verification tracking groups and

FAFSA verifiable information

• Appendix D – Timeline Availability of 2015 IRS

Tax Information

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Electronic Announcement – 11/24/14

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V4/V5 Tracking Results: 2016-2017

TASFAA Spring Conference April 25-27, 2016 11 FAFSA & Verification Updates For discussion purposes only

• The V4 and V5 tracking process in FAA

Access that began in the 2014-15 processing year WILL CONTINUE for 2016-17

• Schools need to select the proper award year

for which they are providing results

• 2015-16, 2016-17, etc.

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V4/V5 Tracking Results – 2016-2017

https://faaaccess.ed.gov

Use the Identity Verification Results section on the FAA Access home page

V4/V5 Tracking Results – 2016-2017

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V4/V5 Tracking Results – 2016-2017

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Whom to report: student for whom school received an ISIR with a Verification Tracking Group of V4 or V5 AND for whom school requested verification documentation

• Do NOT include students the school selected for

verification of identity or high school completion status

When to report: 60 days following the institution's first request to the student to submit the required V4 or V5 identity and high school completion documentation

• Changes to previously submitted Identity Verification

Results must be updated within 30 days

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Resources

• Federal Register Notice – April 1, 2016
• GEN-16-07 – April 5, 2016

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4/1/16 Federal Register

• Updates

– DD Form 214 Certificate of Release or Discharge From Active Duty that indicates the individual is a high school graduate or equivalent can be used as alternative documentation to verify the applicant’s high school completion status – Individual selected for verification required to file a 2015 IRS income tax return and granted a filing extension by the IRS or any nontax filer MUST provide:

• Confirmation of non-filing from the IRS or other relevant

taxing authority dated on or after October 1, 2016

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2017-2018 Verification

• GEN-16-07

– Verification Tracking Group V6 is eliminated

• Schools reminded they can still select items of their

choosing for verification

– SNAP and Child Support Paid removed as individual verification items under V1, V4 or V5 – Suggested Test for 2017-2018 will be provided in a future electronic announcement

TASFAA Spring Conference April 25-27, 2016 13 FAFSA & Verification Updates For discussion purposes only

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2017-2018 Verification

• GEN-16-07

– School can use verification documents from 2016-2017 for following items if meet 2017-2018 requirements:

• Adjusted Gross Income (AGI); U.S. Income Tax Paid ; Untaxed

Portions of IRA Distributions; Untaxed Portions of Pensions; IRA Deductions and Payments; Tax Exempt Interest Income; Education Credits; Income Earned from Work

– Documentation of high school completion obtained prior to the 2017–2018 award year is acceptable – Must obtain new documentation each award year for:

• Number of Household Members
• Number in College
• Identity/Statement of Educational Purpose

Verification Policy Reminders

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16-17 - IRS Tax Return Transcript Matrix

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• Electronic Announcement – March 23, 2016
• Cross-walk of IRS tax financial information

between:

• FAFSA questions
• IRS Tax Return Transcripts
• IRS Tax Returns
• Specifically states do NOT use amounts from any

line items on transcripts for verification purposes that use the word “RECOMPUTED”

TASFAA Spring Conference April 25-27, 2016 14 FAFSA & Verification Updates For discussion purposes only

Verification Policy Updates

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Individuals who filed an amended tax return must submit the following documents to the institution:

• an IRS Tax Return Transcript, or any other IRS tax

transcript(s) that include all of the income and tax information required to be verified; and

• a signed copy of the IRS Form 1040X that was filed

with the IRS

Guidance effective 8/13/15 for 15/16 and subsequent years

• Posted on Program Integrity Q & A website

Verification Policy Updates

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Victims of IRS tax-related identity theft must submit:

• Statement signed and dated by tax filer indicating they

were victims of IRS tax-related identity theft and the IRS has been made aware of the tax-related identity theft; and

• A Tax Return DataBase View (TRDBV) transcript obtained

from the IRS

– Tax filers who cannot obtain a TRDBV transcript may instead submit another official IRS transcript or equivalent document provided by the IRS if it includes all of the income and tax information required to be verified Guidance applies to 15/16 and subsequent years

• Posted in 6/26/15 Federal Register Notice

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Resources

TASFAA Spring Conference April 25-27, 2016 15 FAFSA & Verification Updates For discussion purposes only 2016-2017 Verification

• Federal Register Notice - June 26, 2015
• DCL GEN-15-11 - June 29, 2015
• Program Integrity Q & A Website (“verification”)
• http://www2.ed.gov/policy/highered/reg/hearulemaki

ng/2009/integrity-qa.html

• EA 11/18/15 – Suggested Text and Appendices
• Federal Student Aid Handbook

– Application and Verification Guide – Chapter 4

• Federal Regulations

– 668 Subpart E (668.51 – 668.61); 668.16(f)

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Contacts

• Kansas School Participation Team
• Main Number: 816-268-0410
• Jim Wyant (IIS) - 816-268-0431
• Atlanta Training Officers
• David Bartnicki – 404-974-9312
• Email – firstname.lastname@ed.gov

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Training Feedback

To ensure quality training we ask all participants to please fill out an online session evaluation

• Go to http://s.zoomerang.com/s/DavidBartnicki
• Evaluation form is specific to David Bartnicki
• This feedback tool will provide a means to educate and

inform areas for improvement and support an effective process for “listening” to our customers

• Additional feedback about training can be directed to

joann.borel@ed.gov

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TASFAA Spring Conference April 25-27, 2016 16 FAFSA & Verification Updates For discussion purposes only Questions

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David Bartnicki 404-974-9312 david.bartnicki@ed.gov