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IRS DRT will be back for 2018-2019 ... with some changes

kelsmomkelsmom 15582 replies98 threadsRegistered User Senior Member
The IRS DRT will be back for 2018-2019, with some changes. Here is some info for IRS DRT from an Electronic Announcement about the 2018-2019 FAFSA:

" ... applicants and parents will not be able to view their tax return information on the IRS DRT web page. If an applicant or parent agrees to transfer his/her data back into the FAFSA form, the applicant or parent will also not be able to view the transferred income and tax information on the FAFSA web pages. Instead of the transferred information, applicants and parents will see the words “Transferred from the IRS” in the data entry fields throughout the online FAFSA form and on the Student Aid Report (SAR). The transferred information will still be provided on ISIRs that are sent to schools and state grant agencies. Because the transferred information is not displayed, applicants and parents will be unable to make any corrections to the IRS DRT transferred items on the FAFSA form before or after submission. Institutions will continue to be able to make any necessary corrections. "

And ...

"Since applicants and parents will be unable to see the information that was transferred from the IRS, it is necessary to make changes to how IRA and pension rollovers and income earned from work are reported in the online FAFSA form.

Rollovers: If an amount greater than $0 is transferred from the IRS into the Untaxed Portions of IRA Distributions field or the Untaxed Portions of Pensions field in the FAFSA form, the applicant or parent will be required to answer a new question about whether or not that amount includes a rollover. If the applicant or parent answers “yes,” he/she will be required to provide the amount of the rollover in a new entry field. Our system will then subtract the user-reported rollover amount from the amount of the IRA or Pension distribution that was transferred from the IRS, and the result will be used in the calculation of the applicant’s expected family contribution (EFC).

Income Earned From Work: Because IRS-transferred information will not be displayed, applicants and parents who filed a joint tax return will no longer be able to transfer their combined income earned from work into the FAFSA form from the IRS DRT website. These joint filers will now be required to enter their income earned from work manually. Single applicants and single parents will continue to have their income earned from work transferred from the IRS into their FAFSA form."

And ...

"There will be a new IRS Request Flag with a value of 07 that indicates that the applicant or parent filed an amended tax return. This flag will be set when the applicant or parent links to the IRS, successfully authenticates, chooses to transfer his/her information into the FAFSA form, and the IRS determines that the tax filer has an amended return on file for the relevant tax year (2016 for the 2018–19 FAFSA). However, the income and tax information that is transferred from the IRS will be from the originally filed tax return and will not include changes that were made on the amended tax return (IRS Form 1040X)."
19 replies
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Replies to: IRS DRT will be back for 2018-2019 ... with some changes

  • thumper1thumper1 74793 replies3278 threadsRegistered User Senior Member
    @kelsmom so I take it that the DRT is not yet up and running? There have been a few posts here saying it was already able to be used.

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  • kelsmomkelsmom 15582 replies98 threadsRegistered User Senior Member
    It is not available for the 2016-2017 FAFSA. It is currently available for use by borrowers certifying income for Income Driven Repayment Plans, though.
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  • Mikehills101Mikehills101 3 replies0 threadsRegistered User New Member
    Good post! Thanks for sharing this information. So I think we will wait for next year.
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  • mommdcmommdc 11379 replies31 threadsRegistered User Senior Member
    edited September 2017
    It's good that there is now a question addressing rollovers. That was problematic before.

    But we always had to put earned income in manually for parent 1 and 2, after using DRT, since the joint tax return only has combined AGI/earned income.
    edited September 2017
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  • mommdcmommdc 11379 replies31 threadsRegistered User Senior Member
    I still don't understand how the criminals were able to use DRT to get tax information. You have to sign in with your FSA ID to link the taxes via DRT, and for creating a FSA ID you need name address and more, and that info is cross checked with the SSA.
    So if they already had that information, then why bother with the DRT? The information in the DRT is from a tax return that was already processed two years prior.
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  • rgosulargosula 611 replies29 threadsRegistered User Member
    Will this be available October 1st?
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  • rgosulargosula 611 replies29 threadsRegistered User Member
    edited September 2017
    I'll answer my own question.

    It says here :
    https://studentaid.ed.gov/sa/about/announcements/irs-drt-unavailable

    that it will be available Oct-1, 2017
    edited September 2017
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  • austinpopaustinpop 52 replies4 threadsRegistered User Junior Member
    ...the applicant or parent will be required to answer a new question about whether or not that amount includes a rollover. If the applicant or parent answers “yes,” he/she will be required to provide the amount of the rollover in a new entry field. Our system will then subtract the user-reported rollover amount from the amount of the IRA or Pension distribution that was transferred from the IRS, and the result will be used in the calculation of the applicant’s expected family contribution (EFC).

    I ran afoul of this, as I reported in the other thread:

    http://talk.collegeconfidential.com/discussion/comment/20883187/#Comment_20883187

    What is insidious about this change is that if you get it wrong the first time, that check box is no longer available when you go to make corrections.

    Our only recourse now is to ask DD's OFA to make the corrections.
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  • ContiuousSearchContiuousSearch 2 replies3 threadsRegistered User New Member
    edited October 2017
    I didn't check yes, and EFC went way up. I am stuck too :-(. There was another person (at a college fair) who did same mistake.

    This should be fixed by FAFSA people.

    Any body able to fix it if they made this error?
    edited October 2017
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  • austinpopaustinpop 52 replies4 threadsRegistered User Junior Member
    @ContiuousSearch
    Any body able to fix it if they made this error?

    My DD and I are going down the path of asking her school's OFA to correct this. It's a big state school, so the OFA is very impersonal and institutional.

    I should point out - my DD will be a rising junior in 2018-19, so there is only one school involved. As opposed to incoming freshmen.

    The first phone call was a bust. The counselor told us we had to wait for their Special Circumstances Appeal form to come out in early 2018! The problem is that this school tends to award rolling financial aid, so even if you "win" the appeal, they may not have any more FA to give you.

    We decided to next make a written request, so we can document the school's response.

    If they still punt, the next step would be to appeal in person.

    The final step (this is what the FAFSA phone agent advised us) is to file a complaint at https://feedback.studentaid.ed.gov/

    This whole thing is quite outrageous.

    If someone has a better way, I am all ears!
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  • kelsmomkelsmom 15582 replies98 threadsRegistered User Senior Member
    You should not have to wait & do a PJ for that. Document the rollover with proof that it was actually a rollover (paperwork from the plan), and include a signed copy of the 1040 showing the rollover. Talk with a manager, if necessary, to find out where - specifically - the information needs to be sent so that an update can be made to your information. Once you get that info, write a letter of explanation, sign it, and send or fax it along with the documentation.

    Filing a complaint will most likely get you nowhere. Work with the school or schools to get it changed.

    By the way, there is no way to indicate a rollover if you enter the tax info manually - I just went on the demo site & tried. So you'd have to do this even if you didn't use the DRT. It is a flaw that I know aid administrators have brought up - guess it affects too few people for it to be a programming priority.
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  • austinpopaustinpop 52 replies4 threadsRegistered User Junior Member
    kelsmom wrote:
    You should not have to wait & do a PJ for that. Document the rollover with proof that it was actually a rollover (paperwork from the plan), and include a signed copy of the 1040 showing the rollover. Talk with a manager, if necessary, to find out where - specifically - the information needs to be sent so that an update can be made to your information. Once you get that info, write a letter of explanation, sign it, and send or fax it along with the documentation.
    Yes, we have done exactly that. We've submitted a written letter of explanation, the first 2 pages of form 1040, showing lines 16a and b, and the 1099-Rs that prove the amount that were rollovers. We're awaiting a response.
    Filing a complaint will most likely get you nowhere. Work with the school or schools to get it changed.
    Agreed. I was simply relaying what I was told. This would be a last resort.
    By the way, there is no way to indicate a rollover if you enter the tax info manually - I just went on the demo site & tried. So you'd have to do this even if you didn't use the DRT. It is a flaw that I know aid administrators have brought up - guess it affects too few people for it to be a programming priority.
    That is interesting. So you say when you import from DRT you do NOT see a checkbox for lines 94e and 94f to indicate whether the amount was a rollover? No wonder we missed it then.

    The advantage when you enter the data manually, is that you can enter 0 in line 94f, pursuant to the instructions:
    IRS Form 1040 – Use Lines: 16a minus 16b, and subtract rollover amounts from the total.

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  • austinpopaustinpop 52 replies4 threadsRegistered User Junior Member
    @kelsmom

    Do you have a link to the demo site?
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  • austinpopaustinpop 52 replies4 threadsRegistered User Junior Member
    A quick update on the rollover situation. My DD's OFA today processed the correction as requested.

    We submitted the following in writing on 10/5 (exactly 3 weeks ago):
    • Letter of explanation
    • Form 1040 showing lines 16a and 16b
    • Form 1099-R showing the rollover designation (in boxes G and H) depending on whether it was regular or Roth

    It took an in-person visit this week to finally get it done. To be fair, the timing may have been coincidental, because the FA officer we met said they had approved the change, but had only just this week received the access to the 2018-19 FAFSA tool to make changes from their end.

    Whatever the reason, the FAFSA corrections posted, and the new EFC is indeed in line with expectations.

    The only other slight wrinkle is that the new SAR now shows that our application is now "selected for verification." I don't know if this is automatic, due to the fact a DRT field was overridden, or whether there is something else that triggered this. Either way, it's not a big deal, but worth a mention.

    I will be curious to learn how this pans out for others in a similar situation.
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  • kelsmomkelsmom 15582 replies98 threadsRegistered User Senior Member
    By itself, the update should not have led to you being selected for verification. Most likely, had there been no rollover & using just your other information, you would have been selected the first time around. With the higher EFC from the rollover amount, you were out of range for the selection formula to bother with you. When the fix was applied, your EFC dropped enough that the selection formula picked you.
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  • gaupmwgaupmw 3 replies1 threadsRegistered User New Member
    We're in the same boat as some parents above in that we used the DRT instead of directly entering our data (big mistake in hindsight) and did not see any popup window question about how much of our pension distributions were rollovers...we did a lot of pension plan consolidation last year and ALL of the $ were rollovers. As a result of not being able to make this huge adjustment, our EFC was absurdly high, and now we're trying to figure out how to get this corrected at two schools. There was NO way to correct this via a FAFSA correction, even trying to use the DRT over and over again. It just doggedly stayed stuck on "Transferred from the IRS..." Never again--I'll just type the data in so I can see it myself. Oh, and ironically, the IRS data will not be shown for security reasons, but all the schools ask for nearly a complete set of tax records (which have SSNs, AGIs, ALL of our data) as part of fixing this, and EMAILING these (unencrypted) is fine as far as they're concerned. :-(
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  • austinpopaustinpop 52 replies4 threadsRegistered User Junior Member
    austinpop wrote:
    The only other slight wrinkle is that the new SAR now shows that our application is now "selected for verification." I don't know if this is automatic, due to the fact a DRT field was overridden, or whether there is something else that triggered this. Either way, it's not a big deal, but worth a mention.

    Well, the saga continued, believe it or not.

    A few days after the modified SAR hit my daughter's school's Fin Aid system, it picked up on the fact that her FAFSA had now been flagged for verification, so we had to submit additional forms, and an IRS return transcript. And of course, when you go to the IRS transcript site, it tells you its online system is down, so you must request it by mail!

    It has now been a few weeks since we submitted this latest round of verification documents, and for now, the school's online system seems to indicate they have everything they need.

    This really has been like a game of whack-a-mole, and I am afraid the next mole that needs whacking will pop up unexpectedly soon!
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  • mommdcmommdc 11379 replies31 threadsRegistered User Senior Member
    The way I understand it, you can only enter the rollover amount AFTER initially using DRT, there is a check box or something there to enter the amount. If you miss it then, you cannot do it later.

    Also, if tax transcript is required, you can go to a local IRS office and get the transcript there.
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  • austinpopaustinpop 52 replies4 threadsRegistered User Junior Member
    Nah - it was easy enough to get it by mail. Came within a week.
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