Scuttle the One-Size-Fits-All FAFSA, NASFAA’s FAFSA Working Group Recommends

By Karen McCarthy, Policy & Federal Relations Staff

Simplification of the Free Application for Federal Student Aid (FAFSA) is a hot topic in Washington, especially with the reauthorization of the Higher Education Act looming. In report a released today, a FAFSA Working Group (FWG) convened by NASFAA has chimed in with an application model that would simultaneously simplify the process for students and families of all income levels and accurately target limited federal funds to those most in need.

In a report released today, NASFAA’s FWG provided four recommendations to help streamline the federal student aid application process:

  1. Use prior-prior year (PPY) income data to determine student aid eligibility;
  2. Expand the IRS Data Retrieval Tool (DRT) to include all line items of the 1040 and W2 information;
  3. Institute a three-level application process where, after answering demographic and dependency status questions, applicants would be steered down one of three paths based on their responses to screening questions; and
  4. Revise the result of the Federal Methodology to an index that ranks applicants according to their financial strength, rather than an expected financial contribution.

The three-level application offers applicants a customized set of questions, rather than sticking with a “one- size- fits- all” approach. The tiered application would identify applicants who – according to their existing means-tested benefits and tax filing status – have low presumed financial resources. It would present them with the bare minimum number of FAFSA questions as opposed to making them read through several other questions that may not apply to their circumstances or affect their aid eligibility. Families with more complex financial circumstances would have a more complicated federal application, but the use of PPY and an expanded DRT would permit more information to be directly imported from the IRS.

NASFAA will begin work to model this proposal and will make any necessary modifications to ensure the proposed pathways are in the best interest of students and families.


Publication Date: 7/30/2015

Stephanie O | 7/30/2015 1:56:16 PM

Great job! If it hasn't already been considered, it might be a good idea to think through the idea of allowing DRT to combine tax returns that were filed separately. For example, when two people who are married file separately but need to report both of their incomes on the FAFSA.

Douglas S | 7/30/2015 12:58:24 PM

I like the plan. I think moving from just shrinking the application down to a postcard to a simple process using PPY with most applicants able to do IRS match will allow us to do earlier awards with mostly accurate data. This would be a big positive change from what we are doing now.

Theodore M | 7/30/2015 12:8:26 PM

This is great. Excellent work. We have the technology to easily do this. I think less is not always the simple way. Uncomplicated questions are easy.

William B | 7/30/2015 11:49:58 AM

I agree with the Committee's proposals. It allows easy access, but directs limited funds to those who have the most need.

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