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IRS Data Retrieval Tool Changes for 2018/2019

 

Lo and behold the infamous IRS data retrieval tool returns just in time for the 18/19 FAFSA! However, things are going to look a bit different for students and parents. In support of the effort to protect and enhance the security and privacy of personal data, all data retrieved by the IRS data retrieval tool will not be visible to the parents and students, and will be hidden from view on the IRS data retrieval website, FAFSA web pages, and the SAR. When data is transferred, students and parents will only be able to see the words "transferred from the IRS" in the data entry fields on FAFSA, IRS web pages and SAR. Financial aid professionals and state agencies will be able to view the IRS data, giving them the ability to make corrections but parents and students will not be able to make corrections since the transferred data will not be displayed for them to view. Fewer corrections are anticipated since the data will be coming directly from the IRS, but some possible corrections include: rollover correction from not being able to edit the amount populated by the DRT and amended tax returns.  

 

Special provisions: 

Rollovers- Amounts transferred from the IRS into "untaxed portions of IRA distributions field/untaxed portions of pensions field", the applicant or parent will be required to answer a new question about the rollover and they will be required to provide the amount in a new entry field. The system will then subtract user reported rollover amount from the IRA/Pension distribution that was transferred from the IRS and the result will be used in the calculation of the EFC. 

 

Income earned from work.  Applicants and parents filing jointly will no longer be able to transfer their combined income earned into the FAFSA using the IRS data retrieval tool website. Joint filers will now be required to manually enter their income earned. Single applicants and single parents will continue to have their income earned transferred from the IRS data retrieval tool into their FAFSA form. 

 

Another aspect to the updated IRS data retrieval tool is the addition of Data Field flags. Data Field flags were created and implemented as a result of direct feedback from the financial aid community to identify issues when the DRT Request Flag was not 02. Financial aid officers stated that it would be helpful to know which IRS data fields had changed (or not changed) so that they could easily determine specific information changes that were made once the data was retrieved from the IRS and transferred into the FAFSA form. Flags will appear on the ISIR, and the flags are provided separately for the student and the parents IRS data fields transferred from the IRS. If an applicant who was selected for verification had used the IRS data retrieval tool and none of the transferred information had been changed prior to submission, or submission of a later change, institutions can consider all of that information transferred from the IRS to be verified.  

IRS Data Field Flag Values: 

Blank= IRS data not transferred from the IRS. FAFSA submitted via paper or by a financial aid  administrator 

0= IRS data not transferred from the IRS. FAFSA not submitted via paper or by a financial aid administration 

1= IRS data transferred from the IRS- Not changed by the user 

2= IRS data transferred from the IRS- field changed by user prior to submission of application (only occurs if IRA/Pension fields change by user entering rollover amount) 

3= IRS data transferred from the IRS- Field corrected by the user on this transaction 

4= IRS data transferred from the IRS- Field corrected by the user on a previous transaction  

(Note: The IRS Request flag values and meanings have not changed. The fields above are IRS Data Field flags and refer to specific fields on the FAFSA) 

Any web edits that include information transferred from the IRS will no longer be presented to the applicant or the parent, but instead new SAR comments will display on the ISIR and SAR to alert FAO's that at least one edit was triggered but could not be displayed to the applicant or the parent and therefore could not be resolved online. Comment code 400 is for financial aid issues related to the parent data on the FAFSA. Comment code 401 is for financial aid issues related to the student data reported on the FAFSA. The resolution of these codes depends on the edits that were triggered. IRS request flag 07 indicates an amended tax return and the institution must obtain documentation for the updated information and make any necessary changes regardless if selected for verification or not. 

 

Institutions and third party servicers are required to uphold all Federal and State laws regarding the protection of data used in all aspects of administering Title IV aid. If you have any questions at all about student privacy, please visit https://studentprivacy.ed.gov 

 

For a detailed electronic report from IFAP on all of the changes to the data retrieval tool, read this link in its entirety: https://ifap.ed.gov/eannouncements/080717ChangestoIRSDRT1819FAFSAForm.html