ED Provides Operational Details on Reinstatement of IRS Data Retrieval Tool for 2018-19

By Karen McCarthy, Policy & Federal Relations Staff

In an Electronic Announcement released yesterday, the Department of Education explained the operational details of how the IRS Data Retrieval Tool will function when it is reinstated, beginning with the start-up of the 2018-19 FAFSA application cycle on Oct. 1, 2017.

IRA/Pension Rollovers and Income Earned from Work

As announced in a May 3 Electronic Announcement, to address privacy and security concerns, the reinstated DRT will encrypt the taxpayer’s information and hide the information from the applicant’s view on both the IRS DRT webpage and on the FAFSA webpages. Since applicants and parents will be unable to see the information that was transferred from the IRS, IRA and pension rollovers and income earned from work for joint tax filers need to be entered manually in FAFSA on the Web (FOTW). Details are included in the announcement.

IRS Request, Display, and Data Field Flags

Changes to IRS flags for 2018-19 include:

  • Clarification of required school resolution of IRS request flag 06.

  • Addition of a new IRS Request Flag with a value of 07 that indicates that the applicant or parent filed an amended tax return. Filers of amended tax returns will be allowed to use the DRT; however, the income and tax information that is transferred from the IRS will be from the originally filed tax return.

  • Removal of the IRS Display Flag value of H, which indicated that the applicant or parent self-reported having filed an amended tax return so the IRS DRT option was not displayed. Since amended tax filers will be able to use the DRT, this flag is no longer necessary.

  • Addition of a new set of IRS Data Field Flags on ISIRs to help schools know what, if any, specific information was changed once retrieved from the IRS and transferred into the FAFSA form.

Corrections

Applicants will not be able to make corrections to any of the data items that were transferred into their FAFSA form using the IRS DRT. Therefore, any necessary corrections to these fields must be made by the school.

Web Edits and SAR Comments

Certain FOTW edits require online confirmation or correction of the information that caused the edit to display. Because applicants will not be able to see information transferred from the IRS, any web edits that include information transferred from the IRS will no longer be presented to the applicant or parent. Instead, new SAR comments will display on the ISIR (and SAR) to alert financial aid administrators that at least one edit was triggered but could not be displayed to the applicant or parent and therefore, could not be resolved online.

Further details can be found in the Electronic Announcement.

 

Publication Date: 8/8/2017


James T | 10/26/2017 6:21:36 PM

Today, October 26, 2017, the FAFSA Help Center staff stated that it takes 1-3 days for a parent's FAFSA ID to be verified and approved and until that has been done the data retrieval link cannot be established. This is a serious obstacle to FAFSA events at high school FAFSA nights and other venues designed to assist students and parents with completing their FAFSA in a convenient and timely manner. What can be done to make the IRS FAFSA ID verification and approval instant at the time of completing the FAFSA?

Chandra O | 8/8/2017 9:31:30 AM

Curious what the IRS Request Flag will be for those who manually enter their income earned from work (example: parent with joint return?). Will transferring the IRS data and manually entering income earned from work prior to submitting the FAFSA be enough to complete verification? If not would we have to request further documentation for verification? The latter would be a major step backwards cutting out a large group of applicants (dependent students with parents filing jointly).

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