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Verification enlightening you with knowledge of comfort & cushion “ Using the Magnifying Glass” Presented by: La’Charlotte’ C. Garrett, MBA The University.

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Presentation on theme: "Verification enlightening you with knowledge of comfort & cushion “ Using the Magnifying Glass” Presented by: La’Charlotte’ C. Garrett, MBA The University."— Presentation transcript:

1 Verification enlightening you with knowledge of comfort & cushion “ Using the Magnifying Glass” Presented by: La’Charlotte’ C. Garrett, MBA The University of New Orleans L.A.S.F.A.A. Fall 2011 Conference

2 Verification is…. The audit process of reviewing and determining a students eligibility for Title IV assistance.

3 Verificationis…. Process of verifying accuracy of FAFSA data Regulations define:  Whose application must be verified  Data elements to be verified  Documentation used to verify data elements Regardless of verification selection, we also must resolve discrepancies and conflicting information

4 Session Topics Whose application must be verified Which data application must be verified Verification Exclusions Acceptable Documentation Data Element Updates Policies and Procedures

5 Whose Application Must Be Verified? Applicants selected by Central Processing System (CPS), either randomly or by verification edits Applications selected by institution

6 SARs for CPS- Selected Applications Asterisk next to EFC Comment in student section of first page Verification flag in “For Financial Aid Office Use Only” section set to “Y”

7 Programs to Which Verification Applies Federal Pell Grant Campus-based Programs Subsidized Direct Student Loans

8 Institutionally Selected Applications Institution can select additional applications not selected by CPS Selection may be based on such data elements as:  Estimated tax figures  Low family income levels  Large household size vs. number in college  Completion of certain FAFSA data elements  Other institutional criteria

9 Exclusions From Verification Certain types of applicants and data elements exempt from verification Reason for verification exclusion should be documented in student’s file (example: EFC>COA) Except for applicant who dies during the award year If conflicting information or reason to believe application information is inaccurate, exclusions do not apply

10 Exclusions From Verification Exclusions include or are limited to:  Entire application—student & parent data  Applicant’s spousal data only  Certain data elements

11 Required Verification Elements Number in household Number of household members in college Adjusted Gross Income (AGI) U.S. income tax paid Untaxed Income & Benefits

12 Required Verification Elements Certain Untaxed Income & Benefits  Child support received  Untaxed IRA/Keogh deductions  Interest on tax-free bonds  Other untaxed income and benefits on the tax return such as untaxed pensions and annuities

13 Required Verification Fields Other untaxed income and benefits included on tax return  Untaxed IRA/Keogh deductions  Untaxed pensions/annuities  Taxed portions of Social Security Benefits  Credit of Federal tax on special fuels (non-farmers ONLY)  Interest on tax-free bonds  Additional child tax credit  Untaxed combat pay

14 Items That May Be Verified Using the Tax Return Adjusted Gross Income(AGI) U. S. Income Tax Paid Taxed & Untaxed IRA/Keogh deductions and payments Tax-exempt interest income Untaxed pensions distributions Taxed portions of Social Security Benefits Untaxed IRA Credit for federal tax on special fuels Interest on tax-free bonds Untaxed combat pay (when reported)

15 Acceptable Tax Returns Effective 2012/2013 AY  IRS Data Retrieval for FAFSA  IRS printout with all line items  IRS Tax Transcript (long version) Form 1040 Form 1040A Form 1040EZ Amended 1040X with regular copy of Form 1040

16 Acceptable Tax Return Requirements ***ALL Tax Returns must have the following for Tax Preparer & Verification Signature Requirements*** ONE of these and ONE of these: Stamped Name SSN Typed Name EIN (Employee Identification Number) Signed Name PIN ( Preparer Tax Identification Number) Printed Name

17 Non-Acceptable Tax Documents Federal Return RECAP Form 8453 E-file Authorization Form Short TAX Version Summary (s)

18 Tax Filing Extensions Collect w-2 and one of the following:  IRS From 4886; or  Copy of IRS approval of extension beyond 4-month extension Collect and review the tax return when filed

19 Separating Data on Joint Returns Use w-2 to identify individual’s personal income Assess income & losses on jointly-owned accounts, investments, businesses, & farms at 50% If AGI in joint return was adjusted, reduce individual’s AGI by portion of adjustment attributable to that individual Figure taxes paid using:  Tax rate schedule; or  Proportional distribution method

20 Child Support Documentation Obtain verification worksheet or written statement certifying amount of child support received for all children Statement must be signed by applicant & at least one parent (if dependent)  If ordered by the courts, copy of court docket Statement must be signed by applicant if independent If support paid through government agency, statement from that agency is acceptable

21 Child Support Documentation Request additional documentation if information provided appears inaccurate Copy of separation agreement or divorce decree Signed statement from parent providing support Copies of cancelled child support checks or money order receipts

22 Household Individuals Verification worksheet should include the following: Name Age Relationship to applicant Postsecondary school stated (if applicable) Note: A school may request in-school enrollment verification on those individuals listed in post- secondary institution by applicant

23 Verification Corrections Changes to data elements that were incorrect at time of application Data correct as reported and valid ISIR/SAR:  Pay Federal Pell Grant, FSEOG, & Federal Perkins Loan  Employ students under Federal Work-study Program  Certify/originate & disburse Direct Loans

24 Tolerance Option $400 net error tolerance for all Title IV Programs FAFSA Correct Parent AGI Parent AGI + Student AGI + Parent Untaxed Income + Student Untaxed Income -Parent U.S. Taxes Paid -Student U.S. Taxes Paid =FAFSA data (uncorrected sum) =Correct data (corrected sum) Net differences:≤$400

25 Verification Updates Changes to data elements that were correct at time of application but have since changed Applicable only to 3 items:  Dependency Status  Number in Household  Number of household members enrolled in college

26 Verification Updates ALL students must update dependency status if it changes at any time Marital Status—Cannot be updated if it changes as result of change in marital status once the initial application is completed. Students Must update household size if dependent student’s parent remarries after application, but before verification

27 Verification Status Codes V—Verified W—Without Documentation S—Selected/Not Verified Blank—Not Verified

28 Professional Judgment If using PJ authority to adjust data fields/elements used to calculate EFC on selection application, application must be verified first. If using projected-year income date to recalculate EFC, projected-year data do not need to be verified.

29 Interim Disbursements If a school makes an interim disbursement and it is later determined that the student is ineligible, or if verification was not completed; then the student in ineligible for the award overpayment A student with an Overpayment is INELGIBLE for Title IV funds $300 Overpayment tolerance for campus-based programs only School is liable if the Overpayment is not resolved

30 Verification Time Frames Institutions are responsible to establish deadline dates Institution must receive all requested verification documents and a valid ISIR/SAR within 120 days of the students last day of attendance or the deadline published in the Federal Register or: Federal Pell Grant and Federal SEOG are forfeited Any previously disbursed/paid Aid must be returned

31 Purpose to V.E.R.I.F.Y. V—various documents & attitudes encountered E—efficient eyes needed to pinpoint mistakes & errors to embrace a student’s eligibility R—regulations & readiness to learn rules and resources I—importance of interpreting documents F—field items required for review Y—youthful spirit needed to keep our customers happy

32 Verification Policy & Procedures Must:  Be Written  Address school options where flexibility exists  Be made clear to all students  Be consistently applied

33 Verification Policy & Procedures (cont.) Must include:  Procedures from identifying and processing selected applications  Deadline for applicant to provide documentation & consequences of failure to meet deadline  Procedures applicant must follow to correct application information

34 Verification Policy & Procedures (cont.) Method for notifying applicant of verification results and change in EFC and/or award Procedures for referring cases or suspected fraud or other criminal misconduct to ED Office of Inspector General

35 RECAP

36 Verification is…. Lifetime learning process, not done overnight It may take a few months or years to master The process of reviewing a students data to check for accuracy

37 You should be able to… Identify acceptable documents  Tax Returns  Signature Requirements  Untaxed Income & Benefits  Tolerance Level  Traditional vs. Non-traditional Household

38 Citizenship Students must be a  U.S. citizen  U.S. permanent resident  Eligible non-citizen

39 Social Security ResultCommentAction needed Match conducted SSA confirmedNo commentNo resolution required SSA did not confirm citizenshipComment Listed on SAR/ISIR If U.S. Citizen—documents required If DHS matched ( for eligible non-citizen)— no resolution required SSA did not confirm citizenship, no match on SSN, name or date of birth Comment Listed on SAR/ISIR Resolution required

40 Selective Service How can one register?  FAFSA or on-line Who is required?  Men of ages 18 through 25 are required to register. Contact Information:  

41 Veteran’s Match Status Confirmed Not a qualifying Veteran No data in VA database On Active Duty

42 Drug Conviction/Prisoner Match Student is responsible for contacting Department of Education Contact #:

43 The Past, the Present, and the Future … And Yes, We are There! Verification is

44 Reflecting on the … Past —Taking students at their word  I live in a household of 6…  my grandmother is the only mother I Know… Present —Resolving the conflicting data  Filing Status on Taxes Future —IRS Data Retrieval  IRS Transcripts

45 Question/Comments

46 Works Cited


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