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1
FAFSA on the Web Changes and IRS DRT
ISIR and EFC Formula Changes
Customized/Targeted Verification
Marital Status
Parent Definition
Independent Student Status
2
Start a New FAFSA
3
fafsa.ed.gov
Demographic Information ◦ Social Security Card
◦ Permanent Resident Receipt Card (if applicable)
◦ Address, phone, Email
Federal Student Aid ID ◦ Student
◦ Parent
◦ https://studentaid.ed.gov/sa/fafsa/filling-out/fsaid
◦ Create a New FSA ID
Online Navigation
4
Create a Password Password must be between 4
and 8 characters (any)
Help and Hints
Internet Back Arrow
Auto Save
Saved Applications – Deleted after 45 Days
Live Chat Session
System Security 3 Levels of Encryption
Close/Clear Browser
Student Eligibility
5
Citizenship ◦ Alien Registration Number
High School Completion or GED
Grade Level Received Financial Aid
Highest School – Father and Mother
First Bachelor’s Degree
Work-Study Interest
Drug Conviction
6
Sale or Possession
Grade level other than first year, never attended
Prior aid received
Conviction while receiving federal aid
Conviction on Record
Rehabilitation Program
High School Graduate
7
High School Information ◦ Required for 2017-2018
◦ Regardless of grade level
◦ Name and Location
◦ Encouraged to Confirm but not required to proceed with application
No C-Code for High School Confirmation Process
Dependency Determination
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Prefilled from student demographic questions
Skip Logic through 8 Questions
Support Children
Active Duty
Ward of Court/Foster
Emancipated Minor
Legal Guardianship
Homelessness
Dependent – Option to Provide Parental Info.
Special Circumstances
IRS Data Retrieval Tool
9
Marital Status
Unable to Retrieve Married Filing Separately
Married and either filed Head of Household
Amended Return
Puerto Rican or Foreign Return
Filed Recently – 3 or 8 Weeks
Message – Leaving FAFSA on the Web
Skip Logic
10
Citizenship
High School Diploma
Grade Level
Dependency
Parent Information
IRS Data Retrieval Tool
Financial Data Tax Return Filed
Untaxed Sources
Dislocated Worker
Receipt of Federal Benefits
Income Exclusions
Assets
Assets
11
Simplified Needs Analysis
Asset Protection Allowance
Reporting Assets
Assets Not Included
Skip Logic Type of Tax Return
Eligible to File 1040A/EZ
Total Assets as of FAFSA Filing Date
Dislocated Worker
Receipt of Federal Benefits
Help Topics – Need Help?
Confirmation - Results
12
Instructions
Hyperlinks
Confirmation Number
Data Release Number
Estimated EFC
Estimated Pell and Loans
College Rates
Federal Student Aid Center Contact Information
Institutional Student Information Record (ISIR)
13
Institutional Result of FAFSA Filing
Sent to Listed Schools Electronically
Cover Letter – Comment Codes
Reported Data
Calculation Results
Verification Status
Database Match Flags
NSLDS Data
Verification Information
14
CPS Selection
EFC – Asterisk
Verification Flag Y = Selected for verification
N = No selected
* = Selected on a subsequent transaction
Verification Tracking Flag V1 = Standard Verification
V4 = Custom Verification
V5 = Aggregate Verification
Blank = Not selected for verification
Transaction & Processing Codes
15
EFC Type
Source of Correction
Reprocessing Code
Processed Record Type
CPS Pushed ISIR
Dependency Override
Electronic Transaction Indicator (ETI)
Correction # Applied To
Intermediate Values
Signature Reject EFC
Rejects and Assumptions
16
Reject Codes
Reject Reasons
Rejects Met
Assumption Codes
Signature Rejects
NSLDS Pell History
17
Postscreening Reason Codes
Overpayment Flag
Pell Lifetime Eligibility Used
Pell Lifetime Limit Flag
Pell Payment Data
NSLDS Professional Access Web site – nsldsfap.ed.gov
NSLDS Loan History
18
Default, Discharge, Fraud, and Active Bankruptcy Flags
Loan Satisfactory Payment Arrangement Flag
Loan Details
Annual and Aggregate Loan Limits
Master Promissory Note
Lender, Servicer, and Guaranty Agency Contact Codes
NSLDS Unusual Enrollment Flag
19
NSLDS Financial Aid History Section
Unusual Enrollment Flag
Resolution Required
Codes 2 and 3
What is the EFC?
20
Federal Methodology
Cost of Attendance
Expected Family Contribution
FAFSA Data
Federal Eligibility
Pell Grant
Direct Loans
Campus-Based Programs
State Grant Programs
Institutional Aid Programs
Title IV of HEA – Part F
Federal Register/Volume 81, No. 152, 08/08/2016
EFC Worksheets
21
Formula A, B, C – Regular and Simplified Dependent
Independent without dependents
Independent with dependents
Total Taxed and Untaxed Income
Income Exclusions
Allowances Against Income
Contribution from Assets
Calculations Carried Three decimal places –
Rounded up for .500 - .999
Rounded down for .001 - .499
22
FAFSA Definitions
23
Status as of Date Signed
Current Status – Divorced then Remarried
Separation
Reporting Student Status
Data Reported
IRS Marital/Filing Status
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Single
Unmarried
Divorced
Widow(er)
Head of Household
Considered Married – Last Day of Tax Year
Married Living Apart
Divorce and Remarriage
Annulled Marriage
IRS Publication 17
Head of Household (HOH)
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Considered Unmarried
File a Separate Return
Pay more than 50% of Costs to Keep up Home
Support Test
Qualifying Person
Exemption Claimed
Temporary Absences
Nonresident Alien Married to US Citizen
Benefits of Filing HOH:
Higher Standard Deduction –
$6300 for Single and $9250 for HOH
Lower Tax Rate Wider Income brackets
Refundable Earned Income Credit
Nonresident Alien – Chapter 1, Publication 519
Divorced or Separated
26
Divorce
Separation
Documenting Divorce or Separation
Proof of Separate Addresses
Divorce Decree
Legal Separation Court Document
States Recognizing Legal Separation
Separation - Cannot File Taxes as Single
LEGAL SEPARATION NOT RECOGNIZED:
Delaware
Florida
Georgia
Maryland
Mississippi
New Jersey
Pennsylvania
Texas
Common Law Marriage
27
Definition
Married Couple – All Rights
FAFSA and IRS
State Conditions
US Marriage Laws www.usmarriagelaws.com
Divorce
Documenting Common Law Marriage
STATES THAT RECOGNIZE COMMON LAW MARRIAGE:
Alabama
Colorado
Iowa
Kansas
Montana
Rhode Island
South Carolina
Texas
Utah
Washington D.C.
Resolving Marital Status Conflicting Information
28
Tax Expert
FAFSA
Tax Return
Correct Filing Status
Documentation
Correcting FAFSA
Amending Taxes
Conflicting Situations
CONFLICING INFORMATION:
34 CFR 668.16(f).
34 CFR 668.54(a)(3).
34 CFR 668.61.
2012-2013 Federal Student Aid Handbook, p. AVG-80.
Publication 17
www.irs.edu
Introduction and What’s New
Part 1 – Income Tax Return
Part 2 – Income
Part 3 – Gains and Losses
Part 4 – Adjustments to Income
Part 5 – Standard and Itemized Deductions
Part 6 – Figuring Your Taxes and Credits
Tax Tables and Additional Material
1-800-829-3676
29
What is a Parent?
30
Dependency Status
Parents
Biological
Adoption
Stepparent
FAFSA Data
Foster Parent or Legal Guardian
31
Foster Parents
Legal Guardianship
Legal Custody
Court Appointed
Temporary
Orphan, foster child, or ward of the court (53). A student
who was an orphan—both her parents were dead—when
13 or older is independent even if she was subsequently
adopted. Likewise, a student who was at any time since the
age of 13 a foster child or a ward of the court is
independent even if her status changed later.
Divorced or Separated Parent
32
Divorced
Legal or Informal Separation
Separate Addresses
Residency
Financial Support
Tax Exemption
Death of a Parent
Priority Order for Divorced or
Separated Parents: 1. Which parent did student
live with more during the
12 months preceding
FAFSA completion date?
2. If live(d) with neither or
both equally, which parent
provided more financial
support during the 12
months preceding FAFSA
completion date?
3. If financial support is
exactly 50/50, which
parent has the greater
income and benefits.
Dependency Override
33
Independence Criteria
Unusual Circumstances
Special Cases
Not Eligible
Parents Refuse Support or Unwilling to Provide Information
Student Demonstrates Self-Sufficiency
Not Claimed on parent Taxes
Can Include
Abandonment
Abusive Environment
Unable to Locate
Case-by-case
Dependency Override Form
Independent - Automatic Criteria
34
Age –
Born before
January 1, 1994
Master’s or Doctorate Programs
Married prior to Filing FAFSA
Engaged
Divorce
Independent - Other Criteria
35
Veteran of US Armed Forces or Active Duty
Support Children or Dependents (>50%)
Foster Care or Ward of the Court
Parents Deceased
Emancipated Minor
Legal Guardianship
Homelessness
Independency Documentation
36
Not a Verification Requirement
Resolve Conflicting Information
C-Code Resolution
Documentation
Financial Aid Administrators Discretion
Professional Judgment
37
Tracking Groups
38
V1- Standard
V4 – Custom
V5 – Aggregate
GEN-16-07
(4/5/2016)
Appendix A
Appendix B
Appendix C
Changes for 2017-2018
39 DCL ID: GEN-16-07
April 5, 2016
Documentation 2016-2017
40
V1 – Standard Group
41
Tax Filers o Adjusted Gross Income
o U.S. Income Tax Paid
o Untaxed Portions of IRA
Distributions
o Untaxed Portions of Pensions
o IRA Deductions and Payments
o Tax Exempt Interest Income
o Education Credits
o Number of Household Members
o Number in College
Non-Tax Filers o Income Earned from Work
o Number of Household Members
o Number in College
V4 - Custom Group
42
V5 Aggregate Group
43
Non-Tax Filers
44
GEN-16-07
Federal Register – Vol 81, No. 63 – April 1, 2016 o Signed Statement AND
o W2 Forms AND
o Confirmation of non-filing from the IRS
Conflict Resolution - 399
45
GEN-16-14 – 399 Conflict Code
o Edit will pop up to FAFSA filer - Warning
o Encourage use of DRT
o Pell Eligible – Significant Change in EFC
o Resolve Conflict for both years
o Not Flagged:
o Not Pell for 17-18
o Change in Dependency Status
o Change in Marital Status
o Professional Judgment Flagged ISIRs
o 10/17/16 – Reprocessed a number of ISIRs with
incorrect 399s
Considerations and Clarification
46
Verification Deadlines
Professional Judgment
Interim Disbursements
IRS Extension
Tax Return Preparer
IRS/Pension Distributions (Rollovers)
Student Communications
Conflicting Information
Electronic Signatures
IRS or Pension Rollovers:
• Excluded from EFC Calculation
• FAFSA Instructions –
Untaxed except rollovers
• DRT – Rollover unknown
Assumes untaxed
Solution (DOE Guidance):
• Applicant or FAA may modify
• Maintain documentation
• Written and signed statement
• 02 may update to 04
OK to waive Tax transcript if
only change is rollover amount
47
Thank you – Any Questions?