Verification Sharing Ideas & Panel Discussion

Panel Members Janie Burns Bethel University Celia Bradley Middle Tennessee State University Amanda Heath TTC Covington Willie Thomas Chattanooga State CC Jeanne Hinchee Chattanooga State CC

Agenda Share verification processes Panel Discussion Policy Questions for the Fed?

University Financial Aid Director Janie Burns University Financial Aid Director

Outsourcing Verification We contract with EdFinancial to process verification We collect IRS Tax Transcripts & verification worksheets They request any conflicting information documents We determine our policy and procedures, and what documents we accept

Outsourcing Procedures Develop policy and procedures Scan documents when received from students Add EdFinancial document EdFinancial accesses our system When done – documents are marked complete Reports pulled by each of us

Outsourcing Pros & Cons Number verified per day is not limited to one or two staff members Highly trained personnel that specialize in verification Cost compatible to hiring own staff members Without staff turnover – training –seasonal hire – cost per file Cons NONE

2012–2013 FAFSA Verification-IRS Tax Return Transcript Matrix 2012–2013 FAFSA Information Requiring Verification 2012–2013 FAFSA Q# (Student and Parent) 2012–2013 ISIR Field# (Student and Parent) 2011 IRS Tax Return Transcript Item 2011 IRS 1040 Line # 2011 IRS 1040A Line # 2011 IRS 1040EZ Line # Adjusted Gross Income 35 and 83 42 and 106 Adjusted Gross Income Per Computer 37 21 4 Income Tax Paid 36 and 84 43 and 107 For IRS Form 1040 Transcripts: —Income Tax After Credits Per Computer For IRS Form 1040A Transcripts: —Tentative Tax Per Computer For IRS Form 1040EZ Transcripts: —Total Tax Liability TP Figures Per Computer 55 35 10 Education Credits 43a and 91a 50 and 114 Education Credit Per Computer 49 31 N/A IRA Deductions and Payments 44b and 92b 57 and 121 KEOGH/SEP Contribution Deduction + IRA Deduction Per Computer 28 + 32 17 Tax Exempt Interest Income 44d and 92d 59 and 123 Tax-Exempt Interest 8b Untaxed Portions of IRA Distributions 44e and 92e 60 and 124 Total IRA Distributions – Taxable IRA Distributions 15a – 15b 11a – 11b Untaxed Portions of Pensions 44f and 92f 61 and 125 Total Pensions and Annuities – Taxable Pension/Annuity Amount 16a – 16b 12a – 12b Notes The 2012–2013 FAFSA Verification-IRS Tax Return Transcript Matrix is applicable only to IRS tax filers (IRS Form 1040, 1040A, and 1040EZ) and includes only the income information for tax filers required by the Department to be verified for 2012–2013. IRS Tax Return Transcript—Shows most line items from a tax filer's original tax return (Form 1040, 1040A or 1040EZ). An IRS Tax Return Transcript does not include any information from an amended tax return. Per Computer—A value calculated by the IRS that is present on certain items of an IRS Tax Return Transcript. The Per Computer amount must be used for verification even if it is different than what was reported by the tax filer to the IRS. Married Filing Separately—An applicant or an applicant's parent(s) who filed or will file his or her income tax return as "Married Filing Separately" or who is married to someone other than the individual included on a joint income tax return must provide separate IRS Tax Return Transcripts for each person whose information is included on the FAFSA. IRS Tax Return Matrix http://ifap.ed.gov/eannouncements/attachments/022412Verification1213IRSTaxReturnMatrix.xls

Celia Bradley

MTSU Verification Process Students notified via e-mail to log into self-service to review unsatisfied requirements Verify emancipated minor and legal guardianship Verification tab created for the Financial Aid Office website Student worker updates self-service with documents submitted All documents submitted: File reviewed by full-time verification clerk Missing documents: Filed in missing documents cabinet Corrections made through our Banner system and double checked after correction(s) processed Completed files scanned, checked and shredded

MTSU - IRS Data Retrieval Process FAFSA received with successful IRS Data Retrieval Tax return requirement is automatically updated with a “W” (waived) FAFSA changed after IRS Data Retrieval match Tax return requirement changed to “N” (needed) and tax return transcript is required IRS Data Retrieval Tool used successfully through the FAFSA correction process Tax return requirement automatically updated with a “W”. If this completes all missing requirements, the student will appear on a list of files ready to verify.

MTSU Process - Filed IRS Extension Created a form to collect the following information/certification: Must submit the following: Signed copy of 2010 tax return, schedules and W-2s IRS Form 4868 – Application for Automatic Extension of Time to File US Individual Tax Return IRS approval of extension beyond automatic six-month extension All 2011 W-2s for student/parent filing extension Self employed: Certify estimated 2011 AGI and tax paid figures Must agree to the following: To utilize IRS Data Retrieval Tool or submit tax return transcript after 2011 tax return has been filed Agree to repay any funds the student is no longer eligible to receive after FAFSA is corrected Understand a hold is placed on the Spring aid until verification is completed.

Tennessee Technology Center @ Covington Amanda Heath

Verification Documentation If a student/parent uses the IRS Data Retrieval Tool successfully and the ISIR has a 02 code, the student/parent will only be required to complete the Verification Worksheet. If a student/parent does not use the IRS Data Retrieval Tool and the ISIR has anything but a 02 code, the student/parent will be required to complete the Verification Worksheet and provide an IRS Tax Transcript.  If a student/parent did not file a tax return, the student/parent will complete the Verification Worksheet, & provide W2s. If the student/parent states they did not work, the school may require the student/parent to get a letter from the IRS confirming there are no W-2s on file.

Verification Questions Are there any instances when we can accept a copy of the tax return? If the student/parent did not indicate receiving SNAP (food stamps), but they mark yes on the verification worksheet – is that conflicting information? Please explain the Asset Threshold Exceeded field on the ISIR.

Willie Thomas

Verification Process Student submits FAFSA Requirements are posted on Student’s record Student notified via email CPS selects students for verification If IRS Data Retrieval no transcript required Student completes on-line Verification Worksheet Students who answered yes to emancipated minor, legal guardianship, or homeless youth are selected No IRS Data Retrieval Transcript Required Students who did not use the IRS retrieval submits IRS tax transcripts

Verification Complete Student’s file is packaged and awarded overnight Verification Process IRS tax transcripts scanned into BDMS Verification documents indexed Discrepancies: students are notified via email Verification Worksheets uploaded into BDMS overnight Post information in system (Banner) Corrections are sent to CPS via Banner Verification Complete Student’s file is packaged and awarded overnight

Panel Discussion and Questions