ALTERNATIVE ACCEPTABLE DOCUMENTATION FOR VERIFICATION OF NON-FILING

ED’s Office of Postsecondary Education (OPE) informed schools that the IRS has stopped processing transcripts by mail until further notice. Although IRS Tax Transcripts are available online, some filers have not been able to access their account. As a result, some students may have to submit alternative documentation to complete verification. According to a recent electronic announcement, schools can accept a signed statement certifying that the individual:

• Attempted to obtain the VNF from the IRS or other tax authorities and was unable to obtain the required documentation; and
• Has not filed and is not required to file an income tax return for the applicable tax year, and a listing of the sources of any income earned by the individual from work and the amount of income from each source for the applicable tax year; and
• A copy of IRS Form W–2, or an equivalent document, for each source of employment income received by the individual for the applicable tax year. During this period of national emergency, the Department is permitting institutions to accept a copy of a paystub, an employment offer letter, evidence of direct deposit from an employer, or other similar information for verification purposes. In the case of foster care youth, given the unlikelihood that such students would have earned enough to require them to file taxes, we will permit the institution to accept a signed statement from the foster care youth that he or she earned less than the amount that triggers the requirement for taxpayers to file tax returns.

If non-filing was a result of the taxpayer being granted an IRS extension beyond the automatic six-month extension for the tax year, an institution may accept the following:

• A signed statement certifying that the individual
• Attempted to obtain the VNF from the IRS or other tax authorities and was unable to obtain the required documentation; and
• Has not filed an income tax return and list the sources of any income, and the amount of income from each source for the applicable tax year. If self-employed, the signed statement must also include the amount of AGI and U.S. income tax paid for the applicable tax year;
• A copy of the IRS’s approval of an extension beyond the automatic six-month extension for the appropriate tax year; and
• A copy of IRS Form W–2 for each source of employment income received or an equivalent document for the applicable tax year.

In the event a student, parent, or spouse needs to provide a copy of their W2 but is unable to obtain a copy from the IRS, they may either request a duplicate one from the employer who issued the document, or if that’s not possible, may provide a signed statement attesting to their income that includes:
• The amount of income earned from work;
• The source of that income; and
• The reason why the IRS Form W–2, or an equivalent document, is not available in a timely manner.

CHANGES TO VERIFICATION REQUIREMENTS

In response to concerns about the impact of the suspension of the IRS Data Retrieval Tool on students and families who have been selected for verification of their FAFSA/ISIR information, Federal Student Aid has announced changes to the verification requirements for the 2016-2017 and 2017-2018 award years. These changes replace prior guidance on acceptable verification documentation including alternative documentation a school may accept and provide new flexibilities for schools. These flexibilities may be used by schools as part of their verification procedures and may be implemented immediately for both award years using 2015 income and tax year information.

IRS Tax Return Filers – In lieu of using the IRS DRT, or obtaining an IRS transcript, institutions may consider a signed paper copy of the 2015 IRS tax return that was used by the tax filer for submission to the IRS as acceptable documentation to verify FAFSA/ISIR tax return information.

Verification of Nonfiling – Institutions are no longer required to collect documentation obtained from the IRS or other tax authorities verifying that the applicant, the applicant’s spouse or the applicant’s parents did not file a 2015 tax return (often referred to as Verification of Nonfiling). However, as currently required, the applicant, the applicant’s spouse or the applicant’s parents, as applicable, must provide to the institution:

– A signed statement certifying that the individual has not filed and is not required to file a 2015 income tax return, and a listing of the sources of any 2015 income earned by the individual from work and the amount of income from each source; and

– A copy of IRS Form W–2, or an equivalent document, for each source of 2015 employment income received by the individual.

Additional Documentation Requirements – Some individuals may be required to submit additional documentation to verify their 2015 income and tax information. That information as well as all other verification requirements can be found:

For the 2016-2017 award year
– June 26, 2015, Federal Register Notice; and
– June 29, 2015, Dear Colleague Letter GEN-15-11

For the 2017-2018 award year
– April 1, 2016, Federal Register Notice; and
– April 5, 2016, Dear Colleague Letter GEN-16-07

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