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IRS Data Retrieval Tool & FAFSA

moonrisemoonrise Posts: 75Registered User Junior Member
It seems that a lot of folks a already sending their FAFSAs out. Several of the schools my D is applying to encouraged us to use the IRS Retrieval tool. I am waiting for our employers to send our W2s to do our taxes then upload this info to the FAFSA by Feb 1. Is this the correct way to go about this? I feel as if I'm falling behind!
Post edited by moonrise on
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Replies to: IRS Data Retrieval Tool & FAFSA

  • thumper1thumper1 Posts: 37,010Registered User Senior Member
    I think it's great that the IRS tool is now available. Actually I think if I were doing the FAFSA for an incoming freshman with schools with a January submission date...

    I would do the FAFSA using my BEST estimates based on my 2011 end of year pay information. File as "will file" to meet the deadline. THEN do the taxes ASAP after Feb 1 and update using the IRS tool...I'm not exactly sure how this is done but I believe this is possible. That way, the FAFSA will import all of the info directly off of your completed 2011 tax return....I believe.
  • SamuraiLandsharkSamuraiLandshark Posts: 3,392Registered User Senior Member
    I submitted my FAFSA yesterday. When our W-2s are in and I can file my taxes (I started that yesterday too), I will go back and correct them using the data retrieval tool as well as the rest of my numbers. It's new and I haven't used it before.

    I would rather get my FAFSA in early when I have time and then correct it - it's quick and easy to make corrections when my numbers are better.
  • kelsmomkelsmom Posts: 12,527Super Moderator Senior Member
    It takes a week or two for taxes that are filed electronically to be available for direct download to the FAFSA. Once they are ready, go into the FAFSA to update it, and select "already filed" where it currently has "will file." You will get the option of connecting to the IRS retrieval site & having the info put on your FAFSA. Don't forget to hit the submit button when done! People seem to forget that part ...

    The benefits of doing this include accurate information (people unintentionally make mistakes) ... and if your tax info is selected for verification, you are going to have to do the direct retrieval, anyway, to comply with verification requirements this year.
  • college4lesscollege4less Posts: 1Registered User New Member
    The vast majority of financial aid is not awarded on a "first come, first served" basis the way Guidance incessantly says. Federal aid, for all but the most destitute, does not "run out" and institutional aid is awarded on a "what benefits the college" basis.

    Evidence of this is found in the "professional judgement" exception that every Financial Aid Officer is allowed (the ability to deny aid to those who are eligible or to over-award those who demonstrate less need). There is no need to rush a FAFSA filing; there is a need to know how to optimize a filing and to get that filing right.
  • ohiobassmomohiobassmom Posts: 1,401Registered User Senior Member
    Several colleges my S applied to encouraged us to submit the FAFSA ASAP - not our HS guidance counselor, but the college financial aid folks.

    Since FAFSA allows us to file early with an estimate and then refile with accurate numbers, that's what I did. Better safe than sorry...and many of my S's colleges deadlines are this month, the latest ones are in Feb.

    I can't file my taxes until the first or second week of February so I am glad to take advantage of the estimated filing.
  • AruthaArutha Posts: 270Registered User Junior Member
    It takes a week or two for taxes that are filed electronically to be available for direct download to the FAFSA. Once they are ready, go into the FAFSA to update it, and select "already filed" where it currently has "will file."

    kelsmom,

    How do we know when the data is available for direct download? Last year I tried to link FAFSA to IRS, but I must have done it really early, the link failed.
  • momofthreeboysmomofthreeboys Posts: 11,551Registered User Senior Member
    College4less. Take the number of students at the college and divide it by the number of financial aid team members (excluding the work/study students). I high doubt they randomly sort through them and say "let's do these first." The truth is probably closer to they take batches of them as they arrive and get to work. Not really FIFO but not really totally random. I'm not sure what you mean by maximizing...basically it's as simple as taking the amount on the individual lines of your tax form or amounts that relate to numbers on your tax form (like MM accounts, property etc.) and dropping them into the form. Doesn't require an enormous amount of analytical skils. Now if you "maximized your taxes" that's "awhole nother" story LOL.
  • kelsmomkelsmom Posts: 12,527Super Moderator Senior Member
    college4less, your information is incorrect. Federal aid DOES run out. Only Pell does NOT run out (and Stafford loans, too, of course). The other federal aid most certainly does run out. Work study goes very quickly at many schools ... and FSEOG goes even more quickly. The schools are only given a limited pot of money to distribute. When it is gone, it is gone.

    Institutional money also runs out quickly. Schools allocate X amount of dollars, and most schools award it first come, first served. If there is some money left after the initial packaging run, students can get aid ... but once it's gone, it's gone.

    Aid officers absolutely can exercise professional judgment. And - as has been pointed out on CC many times - it might make no difference - or very little difference - to a student's aid. If the PJ change makes a student Pell eligible, the Pell will be there. If it makes the student eligible for sub rather than unsub loans, those are there. Beyond that ... no guarantees.

    Until recently, I worked as a financial aid officer. I did PJ's, and I wasn't able to give any more money other than a Pell (if the student was eligible). We did not have extra money after everyone was packaged.

    I can tell you how we awarded aid: Aid was awarded using rules that took EFC into consideration. Date of FAFSA filing was part of the rules. Money was distributed based on the rules until it was gone. Work student was gone quickly, going to those with the earliest filing dates. SEOG was gone even more quickly, and not all 0 EFC students who filed by the returning student preferred date got SEOG (it went to potential freshmen first). We did supplement with institutional money for those who filed by the announced date ... but that further decreased the possiblity of getting institutional aid after the announced date.

    DO NOT play Russian roulette with your financial aid.
  • kelsmomkelsmom Posts: 12,527Super Moderator Senior Member
    Arutha, last year was the first year for the IRS link & it didn't always go smoothly. This year should be much better. When you check the box to link to the IRS, you will be taken to the IRS site. If the info isn't ready to be transferred, it will tell you it's not available. Just go back to the FAFSA and log out. Try again later. If you submit any changes on the day you link but don't transfer, the school will get a notification on the transaction stating that you linked but did not transfer. If you don't submit any changes that when you link but don't transfer, the school won't get any type of notification

    And warning to those who might think they can change the direct link data ... the school gets a flag saying that you did a link then changed the information. You will most certainly be asked to provide an IRS transcript in that case!
  • kelsmomkelsmom Posts: 12,527Super Moderator Senior Member
    momofthreeboys, computers make it very easy to award funds based on date of filing! Rules are written that award based on date. Schools very carefully manage funds for initial packaging.
  • kelsmomkelsmom Posts: 12,527Super Moderator Senior Member
    (the ability to deny aid to those who are eligible or to over-award those who demonstrate less need).
    *****
    And no, the is not what professional judgment is. Your advice seems to be based on a bad personal experience ... which is probably also based on your assumption of what happened. This is not helpful for those trying to get good information.
  • absweetmarieabsweetmarie Posts: 1,905Registered User Senior Member
    Is there an issue if you DON'T use the IRS data retrieval system? For instance, I always do my taxes as soon as I'm able, using TurboTax. I assume once the IRS has accepted my return I would face the same lag as anyone else would in terms of activating the data retrieval link (it usually takes a day or so from the time I submit through TurboTax for the IRS to accept the return, IIRC). I, however, am going to feel so much better if I can update FAFSA manually as soon as I have correct data. Is there a great benefit to doing the automatic data retrieval?
  • OlymomOlymom Posts: 1,686Registered User Senior Member
    I've never used the IRS retrieval (going on 7th year of submitting the FAFSA).

    I'm with Kelsmom that being brisk on getting these forms in is a really, really good idea.
    If nothing else, it shows that you are a family that is trying to do the right thing -- on one occasion I had a conversation with a financial aid officer turn much, much warmer when he realized that I had completed all the paperwork early in January. The temperature rise was well worth the effort to be complete and prompt.
  • moonrisemoonrise Posts: 75Registered User Junior Member
    Absweet, from further reading it looks like using the Retrieval Tool will be considered "proof" instead of a photocopy or upload of the 1040-at least for a few of my Ds schools. Since the info is marked as coming directly from the IRS there is no need to verify further. This will save my time and the school's time...with about a two week delay. Not too bad if I'm understanding the process correctly.
  • kelsmomkelsmom Posts: 12,527Super Moderator Senior Member
    Moonrise is correct - good reasons to use the retrieval tool. Plus, you know the information is correctly reported - that is peace of mind.

    In addition, the regulations will require either a direct IRS transfer or an IRS tax transcript if the FAFSA is selected for verification by the federal processor for a tax-return related item. In 2012-13, federal verification requirements will be streamlined to ask for certain things from certain people (as opposed to the old way of asking for everything from everyone selected). Schools can still opt to ask for more info, but in terms of satisfying federal requirements, only specific items will be targeted on a particular FAFSA. If it's an item that would be verified using the tax return, ED figures there's no excuse not to give the "real thing" ... direct transfer or tax transcript.
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