Session #34 Verification Marianna Deeken Virginia Hagins

What is Verification?
• Process by which certain required data reported on the FAFSA is reviewed for accuracy and completeness –To protect taxpayer dollars and program integrity

Required Policies and Procedures

• Applicant’s responsibilities • Clear explanation of documentation requirements • Deadlines for student to provide documentation and consequences of failure to meet deadlines • Method by which student is notified of award changes resulting from verification • Procedures for correction of FAFSA data • Procedures for referring overpayments to ED

Notice to Selected Students
• School must provide a written statement providing a clear explanation of the documentation requirements and the applicant’s responsibilities with regard to the verification process

How Are Applicants Selected?
• CPS selection  Edit checks which identify inconsistencies and potential errors  Random selection • School selection  Criteria set by school

Verification Exclusions

• Student is incarcerated • Student is recent immigrant – either calendar year of award year • Student is deceased • Student is Pacific Island resident • Spouse/parent unavailable  Physical or mental incapacity  Lives in foreign country and cannot be reached through normal means of communication

How Many Do I verify?
• Selected by the CPS  General requirement to verify all those selected by CPS BUT  May stop at 30% of your applicant pool, if CPS selects more than 30%

30% Verification Option
• No school is required to verify more than 30% of its total number of Title IV applicants • School must define total number of Title IV applicants • Could be total number of students who  Apply to the school  Enroll at the school  Receive Title IV aid  Have an ISIR received by the school

What Do I Verify?
• Required for CPS-selected applicant  Adjusted Gross Income (AGI)  U.S. Income tax paid  Household size  Number in college  Certain untaxed income and benefits

What Do I Verify?
• Certain untaxed income and benefits Social Security benefits Child support IRA/Keogh deductions Foreign income exclusion Earned Income Credit Interest on tax-free bonds

What Do I Verify?
• School-selected applicants  School determines data elements to be verified  Need not verify all required federal data elements

What Documents Do I Need?
• For taxable income, base year tax return • For untaxed income and benefits:  Verification worksheet  Official agency documentation  Signed statement • See FSA Handbook

How Do I Complete the Process?
• Compare the verification documents with the original FAFSA information  May create own checklist/spreadsheet  May use verification tool on FAA Access • Determine that  information is correct or  corrections must be made • May use tolerance option if all errors are dollar amount errors

Tax Return Data

Tax Return Data

ISIR Data
Tax Return Filed? Type of 2006 Tax Return Used Eligible to File 1040A or 1040EZ? Adjusted Gross Income U.S. Income Tax Paid Exemptions Claimed Father's Income Earned From Work Mother's Income Earned From Work Total from Worksheet A Total from Worksheet B Total from Worksheet C WILL FILE 1040 N0 45007 3311 03 40000 0 0 0 0

Sample Comparison
ISIR Data AGI Taxes Paid Wkst A Wkst B Tax Return Data Match?

$45,007 $ 2,629 $0 $0

$40,227 $ 3,311 $0 $ 1,500

No No Yes No

This ISIR requires correction!

Verification Status Codes
• Used when reporting Pell, ACG, SMART and Direct Loan payments to COD  V - Verified  S - Selected, but not verified  W - Paid without Documentation  Blank - ISIR not selected by CPS or school

Verification Tolerance
• No recalculation or reprocessing necessary if  There is no change in non-dollar items used to calculate EFC AND  There is no dollar error in excess of $400 as calculated by the following formula

$400 Net Tolerance Option
Original Data
Total Income − Taxes Paid =Total

Corrected Data
Total Income − Taxes Paid = Total

Compare the two totals: Dollar change amount < or = to $400

Interim Disbursements

If there is no conflicting documentation: • For Pell, ACG, National SMART Grant, FSEOG and Perkins  May make one disbursement for applicant’s first payment period • For FWS, employee may work for a maximum of 60 consecutive days from start of enrollment • For Direct Loan and FFEL  May certify/originate subsidized loans  May certify/originate/disburse unsubsidized and PLUS

Verification Deadline
• By the earlier of 120 calendar days after student’s last date of enrollment OR date specified in Federal Register:  Student must provide all verification documentation  ISIR must be corrected, if necessary

Update Applicant Information
• For all students, must always update dependency status if it changes during an award year* • For students selected for verification by CPS, must always update household size and number in college at the time of verification*
*Unless the reason is a change in the

student’s marital status

Remember
• Conflicting information must be resolved, regardless of verification status • Separate process from verification Involves any information of which the school has knowledge Must resolve before disbursing any aid

Contacts
We appreciate your feedback and comments. We can be reached at:
Marianna Deeken • Phone: (206) 615-2583 • Email: marianna.deeken@ed.gov Virginia Hagins • Phone: (415) 486-5621 • Email: virginia.w.hagins@ed.gov

Please provide any comments regarding this training or the trainers to: Jo Ann Borel Title IV Training Supervisor joann.borel@ed.gov 202-377-3930