By Sheryl Ross-Mahoney, Senior Policy Specialist
There’s a subtle but significant change in the language related to tax-filing status on the Free Application for Federal Student Aid.
What does that change mean for financial aid administrators?
As you may have noted, the “Using Your Tax Return” portion of the 2014-2015 FAFSA as well as page 21 of the 2014-2015 Summary of Changes for the Application Processing System indicate that if the applicant – or parent – lists “will file” as the response to FAFSA questions 32 (student) or 80 (parent), the student or parent must correct the information after filing the federal tax return.
For this year’s FAFSA, then, at a minimum the U.S. Department of Education expects tax filers to update their tax-filing status from “will file” to “already filed” as appropriate. The Department also expects that the student or parent make any changes necessary to amounts originally listed as estimated on the FAFSA.
Does this new language mean that financial aid administrators must conduct additional follow-up and monitoring to ensure that applicants update their tax-filing status information on the FAFSA?
The Department indicated to the USA Funds® policy staff that students who note a “will file” status will not require additional follow-up or monitoring responsibilities of the school. When a FAFSA includes a “will file” tax status, it’s the Department that will continue to send notices to those applicants to urge them to make any necessary corrections once the tax returns are filed.
ISIR, EFC changes
As always, however, when a student or parent updates FAFSA information upon filing a federal tax form, the Department will issue a subsequent Institutional Student Information Record (ISIR). The school must review all subsequent ISIRs.
If the school determines that the Expected Family Contribution has changed or that the student’s eligibility is otherwise affected by the updated information, the school must resolve those changes as applicable. Page AVG-117 in the 2013-2014 Federal Student Aid Handbook provides additional information on “Subsequent ISIRs.”
If you have questions about this change in FAFSA language — or about any other federal financial aid policy — send them to USA Funds Ask PolicySM using our online form. We’ll get you an answer, generally within a business day.