U.S. Dept. of Education Changes Verification Requirements in Light of IRS DRT Outage

April 24, 2017

By Carrie Warick, Director of Policy and Advocacy 

Many NCAN members have shared stories of students struggling to complete FAFSA verification since the FAFSA IRS Data Retrieval Tool outage that began March 3. With the May 1 decision deadline just a week away, it is crucial that low-income students are able to complete the burdensome process so that they can receive financial aid packages in time to make an informed enrollment choice. To offer relief in this area, today the U.S. Department of Education announced changes to the documentation required to complete verification. Colleges and universities are no longer required to collect tax transcripts or verification of non-filer forms as part of the process. They can now accept alternative documentation for both of these requirements.

If you have students struggling with verification, guide them to contact their financial aid office immediately. These changes should make it easier for students to complete the process. Please note that it is optional for an institution to make this change in their verification processing, so it is possible that not all campuses will do so. However, a recent survey from the National Association of Student Financial Aid Administrators (NASFAA) demonstrates that many campuses are eager for this change. NCAN joined NASFAA in calling for these changes and more in our March letter.

From the Dear Colleague Letter:

“IRS Tax Return Filers – In lieu of using the IRS DRT, or obtaining an IRS transcript, institutions may consider a signed paper copy of the 2015 IRS tax return that was used by the tax filer for submission to the IRS as acceptable documentation to verify FAFSA/ISIR tax return information.

“Verification of Nonfiling – Institutions are no longer required to collect documentation obtained from the IRS or other tax authorities verifying that the applicant, the applicant’s spouse or the applicant’s parents did not file a 2015 tax return (often referred to as Verification of Nonfiling).  However, as currently required, the applicant, the applicant’s spouse or the applicant’s parents, as applicable, must provide to the institution—

  • A signed statement certifying that the individual has not filed and is not required to file a 2015 income tax return, and a listing of the sources of any 2015 income earned by the individual from work and the amount of income from each source; and
  • A copy of IRS Form W–2, or an equivalent document, for each source of 2015 employment income received by the individual.”

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