Transcript 2014-2015 Verification Updates - DE-DC-MD

2014-2015
VERIFICATION UPDATES
2013 DE-DC-MD FALL CONFERENCE
Vicki A. Smith, Director Student Financial Aid Programs
Allegany College of Maryland
November 12, 2013
Topics:
 1. Formula Changes
 2. FAFSA Changes
 3. Verification Changes
 4. ISIR Processing Changes
FORMULA CHANGES – NONE!
 Reminder: Auto 0 EFC
is $24,000 or less and
family must be eligible
for the SIMPLIFIED
Formula
 Independents without
dependents other than
a spouse do not
qualify for Auto 0 EFC
 The ISIR shows
students who are
eligible - “Auto Zero
EFC Indicator”
 Simplified Formula:
assets are not
included in the
calculation of the EFC
 Remember there are 6
EFC Formulas….
Formulas:
Dependent
Simplified
Regular
Independent With Dependents Other
than a Spouse
Simplified
Regular
Independent Without Dependents
Other than a Spouse
Simplified
Regular
What Does SIMPLIFIED Mean?
For the Dependent Student:
 Someone counted in the
dependent student’s HH size
received one of the means
tested benefits (SSI; SNAP;
Free/Reduced Lunch; TANF,
or WIC) OR
 Parents filed or were eligible
to file 1040A or EZ or were
not required to file OR
 One of the parents is a
dislocated worker
AND
 Parents income is $49,999 or
less (AGI or total of all W-2
forms)
For the Independent Student:
 Anyone counted in the student’s
HH size received one of the
means tested benefits (SSI; SNAP;
Free/Reduced Lunch; TANF, or
WIC) OR
 Student and Spouse (if
applicable) filed or were eligible
to file 1040A or EZ or were not
required to file OR
 The student is a dislocated
worker
AND
 The student’s and spouse’s
income is $49,999 or less (AGI or
total of all W-2 forms)
FAFSA CHANGES
 There are several – some more challenging than
others
 Information based on DRAFT FAFSA DATED
10.24.13 (attached).
FAFSA CHANGES
 Q8 – Q is the same, but changed directions for SSN’s
starting with 666:
Notes for question 8 (page 3)
Enter your Social Security Number (SSN). If you are a resident
of the Freely Associated States (i.e., the Republic of Palau, the
Republic of the Marshall Islands, or the Federated States of
Micronesia) and were issued an identification number beginning
with “666” when submitting a FAFSA previously, enter that
number here. If you are a first-time applicant from the Freely
Associated States, enter “666” in the first three boxes of the
SSN field and leave the remaining six positions blank and we
will create an identification number to be used for federal
student aid purposes.
FAFSA CHANGES
 Q16 – Q is the same, but added to the explanation:
Notes for questions 16 and 17 (page 3)
Report your marital status as of the date you sign your FAFSA.
If your marital status changes after you sign your FAFSA, check
with the financial aid office at the college. Consistent with
the Supreme Court decision on the Defense of Marriage Act
(DOMA), same-sex couples must report their marital status as
married if they were legally married in a state or other
jurisdiction (foreign country) that permits same-sex marriage.
FAFSA CHANGES
 Q34 – New Question this year for the student:
34. For 2013, what is or will be your tax filing status according to
your tax return?
 Single . . . . . . . . . . . . . . . . . . . . .. .1
 Head of household. . . . . . . . . . . . . .4
 Married—filed joint return . . . . . . . . 2
 Married—filed separate return. . . . . .3
 Qualifying widow(er). . . . . . . . . . . . 5
 Don’t know. . . . . . . . . . . . . . . . . . .6
FAFSA CHANGES
 Q. 45a. – added language to exclude Code DD on W-2 Form. This is
listed on most W-2 forms and is the amount the employer pays for
the employee health benefits. (Also under parent section.)
 Q. 45i. – added language to include “untaxed portions of health
savings accounts from IRS Form 1040 – Line 25.” (Also under
parent section.)
 Q. 45j – added language to include money provided by the other
parent of a dependent student if the parents do not live together
and the other parent is providing financial support to the student
and that support is not part of a legal child support agreement.
(GEN 13-12) Also, added language about 529 Plans:
“Money received, or paid on your behalf, also includes distributions
to you (the student beneficiary) from a 529 plan that is owned by
someone other than you or your parents (such as your grandparents,
aunts, and uncles). You must include these distribution amounts in
question 45j.”
FAFSA CHANGES
 Dependency Question Changes: New Language Added:
Q. 51 - Do you now have or will you have children who will receive
more than half of their support from you between July 1, 2014 and
June 30, 2015?
Q. 56 - At any time on or after July 1, 2013, did your high school or
school district homeless liaison determine that you were an
unaccompanied youth who was homeless or were self-supporting
and at risk of being homeless? See Notes page 9.
Q. 57 - At any time on or after July 1, 2013, did the director of an
emergency shelter or transitional housing program funded by the U.S.
Department of Housing and Urban Development determine that you
were an unaccompanied youth who was homeless or were selfsupporting and at risk of being homeless? See Notes page 9.
FAFSA CHANGES
 Parent Instructions: New Language added in instructions and
on Q59:
Step Four (Parent):
Answer all the questions in Step Four even if you do not live with
your legal parents (your biological and/or adoptive parents).
Grandparents, foster parents, legal guardians, aunts and uncles
are not considered parents on this form unless they have legally
adopted you. If your legal parents are married to each other
or are not married to each other and live together, answer
the questions about both of them. If your parent was never
married or is remarried, divorced, separated or widowed, see
Notes page 9 for additional instructions.
FAFSA CHANGES
 Along with these instructions comes a new option for
Parents’ Marital Status:
Unmarried and both parents living together.. . . . . . . .
 Cannot use IRS Data Retrieval Process
 Parents identified as PARENT 1 and PARENT 2 (not
Father and Mother)
FAFSA CHANGES
 What Does This Mean:
 FAFSA will now require information on LEGAL Parents
who LIVE TOGETHER regardless of MARITAL STATUS
OR GENDER.
 LEGAL: defined as BIOLOGICAL or ADOPTIVE Parents.
 Key Points: LEGAL PARENTS AND
LIVE TOGETHER
FAFSA CHANGES
FAFSA Updated Language - Notes on Who is Considered a Parent for Step 4:
 If your parent was never married or is widowed and does not live with your other legal
parent, answer the questions about that parent.
 If your legal parents (biological and/or adoptive) are not married to each other and live
together, select “Unmarried and both parents living together” and provide information
about both of them regardless of their gender. Do not include any person who is not
married to your parent and who is not a legal or biological parent. Contact 1-800-4FED-AID for assistance in completing questions 80-94.
 If your parents are married, select “Married or remarried.” Consistent with the Supreme
Court decision on the Defense of Marriage Act (DOMA), same-sex couples must report
their marital status as married if they were legally married in a state or other
jurisdiction (foreign country) that permits same-sex marriage. If your legal parents are
divorced but living together, select “Unmarried and both parents living together.”
 If your parents are divorced or separated, answer the questions about the parent you
lived with more during the past 12 months. (If you did not live with one parent more
than the other, give answers about the parent who provided more financial support
during the past 12 months or during the most recent year that you actually received
support from a parent.) If this parent is remarried as of today, answer the questions
about that parent and your stepparent.
 If your widowed parent is remarried as of today, answer the questions about that
parent and your stepparent.
FAFSA CHANGES – GEN 13-12:
FAFSA CHANGES
 FAFSA Guidance on this Issue: (I have not seen any
FOTW information on this yet.)
 If your answer to question 59 was “Unmarried and
both parents living together,” contact 1-800-4FED-AID for assistance with answering questions
80-94.
 We will need to give guidance to students/parents on
how to respond to the tax filing status question; how to
calculate AGI and taxes paid, untaxed income, and how
to count household size.
VERIFICATION CHANGES
 Customized Verification started 2012-2013 - HH size;
number in college; SNAP benefits; child support paid; for
tax filers: AGI, taxes paid, education credits, untaxed
income items (untaxed IRA, untaxed pension, IRA
deductions, tax exempt interest); for non-tax filers:
income earned from work
 Expanded in 2013-2014 – 5 Tracking Groups; Tracking
Group number shows on the ISIR.
 2014-2015 - Continuing with the Tracking Groups
VERIFICATION CHANGES
 V2 – is being eliminated. SNAP will still be collected in V1, V4, and V6
if benefits are reported.
 Adding a new group – V6 - “Household Resources Verification Group” Used to verify other untaxed income reported on the FAFSA Q 45 and Q
94.
 For students in this category: if it appears that the untaxed income
and other income (from AGI or Income Earned from Work) do not
appear to provide sufficient financial support, ED is requiring us to
follow up with the applicant and spouse/parent to explain how the
family was financially supported during 2013. (GEN 13-16)
 ED has said it is okay to include on our review income from the
following sources: welfare, untaxed SS, and SSI.
 Acceptable documentation for Group V6 – copies of Form W-2 for 2013
and signed statements listing the SOURCE of the untaxed income and
the AMOUNT of the income from each source for 2013.
VERIFICATION CHANGES
 NEW GUIDANCE: Non-Tax Filers
 Persons stating they are not required to file a federal return: if
the school questions this claim, the school must require the
applicant to submit a “Verification of Nonfiling” from the IRS for
2013. Use IRS Form 4506-T and check Box 7. (Form Attached.)
 Please note the IRS will not be responding to these
requests until after JUNE 15, 2014.
VERIFICATION CHANGES
 Required reporting by schools on FAA ACCESS the results of
verification for Verification Groups 4 and 5.
 There will be a drop down menu with options and we must
select one. (See Options Later Slides.)
 “The school is not exempt from reporting a code for
students who never enroll in the school.”
 Report option opens in January with only manual entry for
each student; later in April there will be a group reporting
option, where we can upload multiple students in a file.
VERIFICATION CHANGES
 FAAs will be able to
enter SSNs/Name
ID/Verification
Results from a
dropdown menu on
the page.
 Click “ADD SSNs”
and enter
additional ones.
VERIFICATION CHANGES
 Dropdown options on FAA ACCESS will be:
 Verification completed in person, no issues found
 Verification completely remotely, no issues found
 Verification attempted, issues found with identity
 Verification attempted, issues found with HS Completion
 No response from applicant or unable to locate
 Later in 2014, there will be an option to load many
students at one time using a flat file report.
VERIFICATION CHANGES
 Paper Tax Returns: Can be accepted to complete verification only in very
limited cases:
 Persons filing an amended tax return
 Victims of IRS identity theft
 Filed non-IRS income tax return
 Documentation Update: Child Support Paid - can now also accept records
of electronic payments made.
 Reminder: the following information is considered verified if the
applicant/parent used the IRS Data Retrieval process and the information
is unchanged:
 AGI
 U.S. taxes paid
 Untaxed portions of IRA distributions
 Untaxed portions of pensions
 IRA deductions and payments
 Tax exempt interest income
 Education credits
VERIFICATION CHANGES
AN IRS Tax Return Transcript is still required in certain
:
situations
– this is unchanged from 2013-14
VERIFICATION CHANGES
IRS Tax Return Continued…..
ISIR PROCESSING CHANGES
 ISIR will now include the DRT Reason Flag.
 Will be one for the student and one for the parent, if applicable.
 Flag is designed to show us if the student and parent were
presented with the IRS Data Retrieval Tool, and if not, the
reason why it was not displayed.
ISIR PROCESSING CHANGES
A
E
Student skipped the income and asset questions – IRS DRT was
not displayed
IRS DRT was displayed to student
Tax return status not equal to “Already completed” – IRS DRT was
not displayed
Marital status date greater than or equal to January 2014 – IRS
DRT was not displayed
First three digits of SSN are 666 – IRS DRT was not displayed
H
Student amended his/her tax return – IRS DRT was not displayed
J
Student filed a Puerto Rican or Foreign tax return – IRS DRT was
not displayed
Student is married and tax return filing status is Married Filed
Separate Return – IRS DRT was not displayed
Student is married and tax return filing status is Head of Household
– IRS DRT was not displayed
Conflict between the student’s marital status and tax return filing
status – IRS DRT was not displayed
IRS DRT not available (for example, paper, EDE, or FAA Access)
B
C
D
K
L
M
Blank
ISIR PROCESSING CHANGES
A
Dependent student has special circumstances or independent student skipped the parent questions – IRS
DRT was displayed
B
IRS DRT was displayed to parent
C
Tax return status not equal to “Already completed” – IRS DRT not displayed
D
Marital status date greater than or equal to January 2014 – IRS DRT was displayed
E
First three digits of SSN are 666 – IRS DRT was not displayed
F
Non-married parent or both married parents entered all zeroes in SSN – IRS DRT not displayed
G
Neither married parent entered a valid SSN – IRS DRT not displayed
H
Parent amended his/her tax return – IRS DRT not displayed
J
Parent filed a Puerto Rican or Foreign tax return – IRS DRT not displayed
K
Parents are married and tax return filing status is Married Filed Separate Return – IRS DRT not displayed
L
Parents are married and tax return filing status is Head of Household – IRS DRT not displayed
M
Conflict between the parents’ marital status and tax return filing status – IRS DRT not displayed
N
Parents’ marital status is “Unmarried and both parents living together” – IRS DRT was displayed
Blank
IRS DRT not available (i.e., paper, EDE, or FAA Access)