The Department of Education stipulates that we must receive tax data directly from the IRS, via one of the following:
1) The IRS data retrieval option on the FAFSA (preferred)
2) A “tax return transcript” ordered from the IRS
What is the IRS Data Retrieval Process?
This is an option on the FAFSA that eligible applicants can use to import their tax data from a processed tax return from the IRS directly into the FAFSA. The Department of Education is urging families to choose this option in order to complete their FAFSAs more easily and accurately. For written instructions, click here. To view a Data Retrival Tool tutorial, click here.
Who is eligible?
Most applicants will be eligible. Please note that the student and parent(s) need to each choose the option. If an applicant is not eligible based on the responses to the FAFSA questions, the data retrieval option will not be offered.
However, some applicants will not be able to use this option. If this is the case, and the student is selected for verification, the parent (and student) will need to submit an IRS tax return transcript if they filed a tax return. For written instructions, click here. (PDF) For online instructions, click here.
What is a “tax return transcript”?
A “tax return transcript” is a print-out from the IRS that contains most of the information on your tax return. Although the name is similar, it is NOT the same as the tax return that you file. A tax return transcript is provided free of charge by the IRS and can be requested online, by phone, or by mail (click here for written instructions). If you are not eligible to complete the data retrieval process, or if you have tried repeatedly to complete the data retrieval process without success, you will need to request a tax return transcript.
When will the data retrieval option be available on the FAFSA?
For the 2015-2016 aid year, since the IRS will not begin accepting tax returns until mid to late January, the data retrieval option will probably not be available until later in February once tax returns are being processed. If you complete your FAFSA prior to this time, once your tax return has been processed, you can log back in to FAFSA and do a correction, this time choosing to use the data retrieval option.
What if I file my FAFSA before I submit my tax return?
If you are a prospective student, you may need to complete the FAFSA using your best estimates for your 2014 tax information, in order to meet the deadline. Once your tax return has been processed, you can return to the FAFSA to complete the data retrieval option (see sheet for details).
I filed my FAFSA using estimates, and I have now filed my taxes. How long will it be before I am able to make the appropriate FAFSA updates using the IRS data retrieval option?
Electronic filing, refund anticipated:
Wait 2+ weeks after filing and then try data retrieval.
Paper filing, refund anticipated
Wait 6-8 weeks after filing and then try data retrieval.
Electronic filing, taxes owed
Generally the IRS will not process tax returns with taxes owed until after April 15. Wait until 2+ weeks after April 15.
Paper filing, taxes owed.
Here, too, the IRS will not process a return with taxes owed until after April 15. Wait 6-8 weeks after April 15 and try the data retrieval.
My son/daughter is a prospective student who has been selected for verification, but the IRS may not process my tax information until after the May 1 decision deadline. What should I do?
We can process an award estimate for a prospective freshman if the student meets all of the following criteria:
1) The student and/or his/her parents are unable to submit the data retrieval information or a tax return transcript by April 1.
2) The tax filing status is listed as “Already Completed” on the most recent FAFSA submission/correction.
3) All other required verification items have been submitted.
If the above requirements are met, we will process an award estimate without final tax data. Our goal is to have an estimate to the student in time for the student to make an enrollment decision by Admissions’ May 1 deadline. Final tax data will, however, need to be submitted before award funds can be disbursed.
What if I’m not selected for verification—do I still need to complete the data retrieval?
Theoretically, no. However, since you don’t know ahead of time if you will be selected for verification, it is best to complete the data retrieval option on the FAFSA if you are eligible. In fact, those who are eligible but choose NOT to complete it are more likely to be selected for verification.
I’ve been selected for verification but I am not filing taxes – what do I need to do?
You may be asked to complete a verification worksheet. There is a box to check to indicate that you did not file a tax return.
INSTRUCTIONS FOR TAX FILERS WITH UNUSUAL CIRCUMSTANCES
Please read and follow the instructions below if any of these unusual circumstances apply to the student and/or parent(s):
Tax filing extension
Victim(s) of tax administration identity theft (IRS identity theft)
Filed a non-IRS income tax return
1. Individuals Granted a Filing Extension by the IRS
If an individual is required to file a 2014 IRS income tax return and has been granted a filing extension by the IRS, please provide the following documents:
- A copy of the IRS Form 4868, ‘‘Application for Automatic Extension of Time to File U.S. Individual Income Tax Return,’’ that was filed with the IRS for tax year 2014;
- If applicable, a copy of the IRS’s approval of an extension beyond the automatic six-month extension if the individual requested an additional extension of the filing time for tax year 2014; and
- A copy of IRS Form W–2 for each source of employment income received for tax year 2014 and, if self-employed, the Self-certified AGI statement.
2. Individuals Who Filed an Amended IRS Income Tax Return
If an individual filed an amended IRS income tax return for tax year 2014, please provide both of the following:
- An IRS Tax Return Transcript of the original IRS tax return for the 2014 tax year; and
- A signed copy of the 2014 IRS Form 1040X, "Amended U.S. Individual Income Tax Return," that was filed with the IRS.
3. Individuals Who Were Victims of Tax Administration Identity Theft
A victim of Tax Administration identity theft (IRS identity theft) who has been unable to obtain a 2014 IRS Tax Return Transcript or use the IRS Data Retrieval Tool must contact the IRS at 1-800-908-4490. Upon authentication of the tax filer’s identity, the IRS will provide, by U.S. Postal Service, a printout of the tax filer’s 2014 IRS income tax return information.
4. Individuals Who Filed Non-IRS Income Tax Returns
If an individual filed or will file a 2014 income tax return with Puerto Rico, another U.S.territory (e.g., Guam, American Samoa, the U.S. Virgin Islands, the Northern Marianas Islands), or with a foreign country, they must provide:
- A signed copy of that 2014 income tax return(s) (click here for further instructions) or
- A transcript obtained from a government of a U.S. territory or commonwealth, or a foreign central government that includes all of the tax filer's income and tax information required to be verified for tax year 2014. For more information, please click here.