National Association of Student Financial Aid Administrators The following is a presentation prepared for: RMASFAA Conference Cheyenne, WY October 20 23, 2013 David Tolman Training Specialist Division of Training & Regulatory Assistance Matt Johnson Financial Aid Counselor University of Nebraska at Kearney 2 Verification IRS DRT Student FAFSA CPS School 2013 NASFAA 3 2013 NASFAA 1 Verification
Verification Foreign Tax Return Identity Theft Amended Return Tax Extension Household Size Number in College Tax Transcript Student Child Support Paid SNAP School V5 V1 V6 V2 V3 V4 IRS DRT Name Change FAFSA Statement of Educational Purpose High School Completion Home School Completion GED CPS Notary Public Doogie Howser? 2013 NASFAA 4 Overview of Session Review verification tracking groups and changes for 2014 15 Address a variety of questions on verification topics Discuss your institutions Policies Practices Challenges Success stories 2013 NASFAA 5 2013 NASFAA 6 Verification 2 2013 NASFAA
Verification Tracking Groups and Codes 2013 14 V1 V2 V3 V4 V5 Standard SNAP Child Support Custom Aggregate 2013 NASFAA 7 2014 15 Tracking Groups and Codes 2013 14 V1 V2 V3 V4 V5 Standard SNAP FSA Use Only Child Support Custom Aggregate Household Resources 2014 15 V1 V2 V3 V4 V5 V6 2013 NASFAA 8 V6 Household Resources Tracking Group Other Untaxed Income Payments to tax-deferred pension and savings Child support received Housing, food, and other living allowances paid to members of the military, clergy, and others Veterans noneducation benefits Other untaxed income Money received or paid on the applicant s behalf 2013 NASFAA 9 2013 NASFAA 3 Verification
2013 NASFAA 10 Verifying Income Tax Filers Adjusted Gross Income (AGI) U.S. Income Tax Paid Untaxed portions of IRA distribution/ pensions IRA deductions and payments Tax exempt interest income Education credits Nontax Filers Income earned from work 2013 NASFAA 11 Verifying Income Include income for both of student s legal parents if parents live together See GEN-13-12 No information yet on verification impact of Supreme Court decision on Defense of Marriage Act (DOMA) GEN-13-12: April 29, 2013 GEN-13-16: June 13, 2013 Supreme Court decision: June 26, 2013 2013 NASFAA 12 Verification 4 2013 NASFAA
Household Information Indicate household members enrolled at least halftime in a Title IV-eligible program during award year, other than parents Impact of GEN-13-12 on household size 2013 NASFAA 13 Household Information Household size not verified if Independent student Household size is one and applicant is single Household size is two and applicant is married Dependent student Household size is two and parent is single Household size is three and parents are married or unmarried and living together Number in college not verified if 1 reported 2013 NASFAA 14 SNAP/Child Support Paid Verify for all tracking groups if SNAP or child support paid is included on ISIR Although SNAP tracking group is removed, remains required verification item An institution may accept records of electronic payments of child support paid If no amount originally reported on FAFSA, update ISIR with corrected amount 2013 NASFAA 15 2013 NASFAA 5 Verification
High School Completion May rely on document institution collects for admission or other purposes if the document: Demonstrates high school completion (not 7 th - semester transcript) Is readily available Foreign diploma or Secondary school leaving certificate for foreign students Alternative documentation does not include selfcertified statement of completion 2013 NASFAA 16 Equivalent of High School Diploma Submit documentation for 1 of the 4 following equivalents: GED Certificate GED Transcript State Certificate Student passed a state authorized exam State recognizes as equivalent of a high school diploma Academic Transcript Student successfully completed two-year program acceptable for full credit toward bachelor s degree 2013 NASFAA 17 Equivalent of High School Diploma Student who excelled academically in high school, and: Did not complete high school Is enrolling in an associate or higher level program Documentation From High School - Student excelled academically Institutional Documentation - Student met school s formal, written policy for admission 2013 NASFAA 18 Verification 6 2013 NASFAA
Homeschooled Submit either: Transcript (or equivalent) Lists secondary school courses completed Documents successful completion of a secondary school education Signed by parent or guardian Secondary School Completion Credential Issued for home school Recognized under state law 2013 NASFAA 19 Statement of Educational Purpose/Identity Present in person both: Valid, government-issued photo identification Signed statement Notarized if unable to appear in person Statement must use exact language issued by ED 2013 NASFAA 20 Statement of Educational Purpose/Identity Institution must authorize individuals who review identity documents Include authorized individuals in policies and procedures Maintain annotated copy of ID document Date identification received Name of individual who received ID 2013 NASFAA 21 2013 NASFAA 7 Verification
Statement of Educational Purpose/Identity Report Identity Verification Results for all applicants contacted to verify identity and high school completion Verification completed in person, no issues found Verification completed remotely, no issues found Verification attempted, issues found with identity Verification attempted, issues found with high school completion No response from applicant 2013 NASFAA 22 Untaxed Income V6 Household Resources Verification Tracking Group Untaxed income items not on IRS tax return V6 must also verify: Income Household size / number in college SNAP, if reported on FAFSA Child support paid, if reported on FAFSA 2013 NASFAA 23 Untaxed Income If combined income sources appear too low to financially support family: Contact student or parent to request sources and amounts of financial support received during 2013 calendar year ED will provide suggested text Correct for additional income, if any, identified during process 2013 NASFAA 24 Verification 8 2013 NASFAA
2013 NASFAA 25 Must we complete verification for a student receiving only a Direct Unsubsidized Loan? No, unless the student is eligible for need-based aid but has declined it, or later becomes eligible for need-based aid Strongly encouraged to verify high school completion status and identity/statement of educational purpose for V4, V5 applicants 2013 NASFAA 26 For institutionally selected students, must we request the same documents specified by ED? Institution can determine what elements to verify and what documentation to accept for applicants it selects If CPS selects applicant on a subsequent ISIR, institution must collect required documentation Quality Assurance (QA) institutions are exempt from verification rules Corrections must be sent to CPS 2013 NASFAA 27 2013 NASFAA 9 Verification
What are we supposed to verify for Automatic Zero EFC students? Minimal requirements for V1 and V5 Dependent students Parents AGI if tax filer Parents income earned from work if nontax filer Receipt of SNAP if auto zero based on SNAP Independent students AGI if tax filer Income earned from work if nontax filer Number of household members Receipt of SNAP if auto zero based on SNAP 2013 NASFAA 28 What are we supposed to verify for Automatic Zero EFC students? Must verify high school completion status and identity/statement of educational purpose for V4, V5 Must also verify SNAP and child support paid, if reported on ISIR Untaxed income verification for V6 pending ED guidance (This guidance applies to 2013 14, ED has not yet released official 2014 15 guidance) 2013 NASFAA 29 How do we identify and handle IRS rollovers of IRA s, pensions, or annuities? Untaxed portion of IRS distribution on ISIR may indicate rollover, or actual distribution Additional documentation needed from tax filer to identify IRS rollover Signed statement, or Signed, dated IRS Tax Return Transcript with Rollover noted beside applicable item(s) Considered a correction, not PJ 2013 NASFAA 30 Verification 10 2013 NASFAA
Are we supposed to use text provided by ED for verification requests? Suggested text provided in lieu of verification worksheets Must use exact wording for Statement of Educational Purpose All other examples are suggestions ED will provide suggested text for new V6 verification tracking group (untaxed income) 2013 NASFAA 31 Can we update a student s marital status change only during verification? An institution may require an applicant to update dependency status at any time during the award year due to a marital status change To address an inequity or to reflect more accurately the applicant s ability to pay The applicant need not have been selected for verification Other items must also be updated to reflect the marital status change (household size, number in college, spouse s income, etc.), which may require verification 2013 NASFAA 32 2013 NASFAA 33 2013 NASFAA 11 Verification
Please send your questions to: tolmand@nasfaa.org 2013 NASFAA 34 Verification 12 2013 NASFAA
Documents for Completing Verification 2014 15 (Reflects Information Available as of September 13, 2013) 2013 NASFAA 13 Verification Data Element Tax Return Items Tax Filers Only Adjusted Gross Income (AGI) U.S. Income Tax Paid Education Credits IRA Deductions and Payments Tax Exempt Interest Untaxed portions of IRA distributions Untaxed portions of pensions Income Earned from Work Nontax Filers Only Verification Document(s) Standard documents: Unaltered 2013 tax information obtained through IRS Data Retrieval; or Transcript from the IRS that lists all income and tax information required to be verified for the 2013 tax year Special cases: Filed joint tax return, no longer married as of date FAFSA completed: Transcript from IRS that lists all income and tax information required to be verified for the 2013 tax year; and A copy of each W-2 received for tax year 2013 Required to file tax return and requested filing extension with IRS: A copy of IRS Form 4868 (Application for Automatic Extension of Time to File U.S. Individual Income Tax Return), and copy of IRS approval of an extension beyond the automatic six months if the tax filer requested more time to file; and A copy of each W-2 received for tax year 2013, or a *signed statement certifying AGI for a self-employed applicant A copy of each W-2 received for tax year 2013; and *Signed statement certifying: Nontax filer has not filed and is not required to file a tax return for 2013; and Income source(s) and amount(s) from each employment source not reported on an IRS Form W-2 Tracking Flag(s) Notes V1, V5, V6 Refer to guidance from Department of Education (ED) for cases of: Victim of identity theft Amended tax return Foreign tax return V1, V5, V6 If institution questions nontax filing status of student or parent: Request IRS Form Verification of Nonfiling from applicant, obtained by tax filer by submitting IRS Form 4506-T to IRS with box 7 marked.
14 2013 NASFAA Data Element Other Untaxed Income not on an IRS Tax Return Child support received Housing, food and other living allowances paid to members of the military, clergy, and others Money received or paid on the applicant s behalf Other untaxed income Veterans noneducation benefits Number of Household Members (HHS) Verification Document(s) *Signed statement from student, and parent of a dependent student, listing: Source(s) of untaxed income and the amount received from each source during the 2013 tax year; and A copy of each W 2 received for tax year 2013 *Signed statement indicating: Name and age of each household member; and Relationship of household member to the applicant Tracking Flag(s) V6 Notes If the total of verified taxable and untaxed income does not appear sufficient to provide financial support to the family, the institution must ask the student, or parent of a dependent student, to explain how the family was supported during the 2013 calendar year. V1, V5, V6 Not required for dependent student if: HHS = 2 and parent is single, separated, divorced, or widowed; or HHS = 3 and parents are married Not required for independent student if: HHS = 1 and applicant is single, separated, divorced, or widowed; or HHS = 2 and applicant is married
Data Element Verification Document(s) Tracking Flag(s) Notes 2013 NASFAA 15 Verification Number in College Supplemental Nutrition Assistance Program (SNAP-Food Stamps) *Signed statement indicating: Name and age of each household member who will be, or currently is, attending an eligible Title IV institution on at least a half-time basis during the 2014 15 award year; and Name of institution household member will be attending Do not include: Parent(s) of dependent student Household members enrolled in U.S. military academies *Signed statement from student, or parent of dependent student affirming SNAP-Food Stamps benefits were received during 2012 and/or 2013 calendar years V1, V5, V6 Verification not required if value of 1 reported for number in college If institution questions accuracy of signed statement: Obtain statement from each institution in which household members are indicated to enroll to validate the household member is, or will be, attending on at least a half-time basis If the household member has not yet registered, no further action is necessary. The institution can refer to its own records if household member enrolled there V1, V4, V5, and V6, if receipt of SNAP is reported on ISIR If institution questions receipt of SNAP: Request applicant to provide documentation from agency which provided SNAP benefit
16 2013 NASFAA Data Element Child Support Paid High School Completion Status *Signed Statement indicating: Amount of child support paid; Verification Document(s) Name of person who paid the child support; Name of person to whom child support was paid; and The name(s) of children for whom child support was paid High School Diploma: Copy of high school diploma; or Copy of final transcript showing date student completed secondary school education; or Copy of secondary school leaving certificate, or similar document, for students who completed high school or equivalent level in a foreign country and are unable to obtain a copy of either a diploma or a final transcript Tracking Flag(s) V3; V1, V4, V5, V6 if child support paid is reported on ISIR Notes If institution questions accuracy of information in signed statement, request additional documentation, such as: Copy of divorce decree or separation agreement indicating amount of child support to be provided; or Signed statement from child support recipient indicating amount received; or Copy of payment documents, such as electronic payment record or copy of paper checks, etc. V4, V5 Alternative documentation can be collected if standard documentation is not available from school, district, or state agency.
Data Element Verification Document(s) Tracking Flag(s) Notes 2013 NASFAA 17 Verification High School Completion Status (cont d) Recognized Equivalent of High School Diploma: General Educational Development (GED) Certificate; or State certificate recognized by state as the equivalent of a high school diploma that student received after passing state-authorized examination; or Academic Transcript indicating student completed at least a twoyear program acceptable for full credit toward bachelor s degree; or For student who is seeking enrollment in a program leading to at least an associate degree or its equivalent and who has not completed high school but excelled academically in high school, documentation that student: Excelled academically in high school, and Met the institution s formalized, written policies for admitting such students Home School Completion: State-issued credential, if student completed home school where state law requires students to obtain a secondary school credential for home school completion; or Transcript, or equivalent, if state law does not require student to obtain a secondary school credential for home school completion. Transcript must: List secondary school courses the student completed; Document successful completion of a secondary school education in a home school setting; and Include signature of parent or guardian V4, V5 V4, V5 Alternative documentation may be accepted if parent(s) and/or guardian(s) who provided home schooling is deceased.
18 2013 NASFAA Data Element Statement of Educational Purpose/Identity Verification Document(s) Valid, government-issued photo ID presented to an authorized school official (school must maintain a copy that is annotated with the date the document was received and name of individual who reviewed the document); and Original *signed statement of educational purpose, containing exact text as provided by ED Tracking Flag(s) Notes V4, V5 If student is unable to appear in person: Copy of valid, government-issued ID; and Original signed and notarized statement of educational purpose, containing exact text as provided by ED * Signed statements may be collected on a verification worksheet while signed documents must contain the signature on the document itself