Be Careful About New College Aid Application Method

September 21, 2017

In just a couple of weeks on October 1st, families with college-bound students will be able to submit the Free Application for Federal Student Aid (FAFSA) to determine eligibility for college financial aid for the 2018-2019 academic year.  For this application, families will be using their financial data from their filed 2016 tax return.

A relatively new feature of the online FAFSA submission process is the Data Retrieval Tool (DRT).  This function allows a user to link the FAFSA application with their filed tax return on the IRS database and automatically populate answers for income and tax questions.  The DRT also alerts the colleges that the information has been auto-entered by the IRS link, thereby eliminating the need to later “verify” FAFSA data. Last year, however, the DRT was suspended over security problems.

This year, (as a solution to security concerns), the DRT will no longer display the data that is entered onto the FAFSA application.  Instead, entries will just read “Data entered by the IRS”.  In addition, the Student Aid Report will also not list the submitted data.  This may not seem like a problem, but there is actually a potential issue.  By not displaying the actual data, parents and students are literally submitting a “blind application” and will be unable to make corrections themselves once the FAFSA is submitted.  The only way a change could be made is with the financial aid office of each college where the student has submitted an admissions application.  Considering that parental income is often the largest factor in calculating a family’s Estimated Family Contribution (EFC), it is critical to ensure the income information is accurate.  Many times, parents are shocked at how high their EFC is.  Not knowing what went into the resulting figure can elevate stress levels and add to the work of the financial aid and college process.

To solve this issue, parents should consider filling in the FAFSA application question-by-question and not using the DRT for the initial submission.  Of course, this will entail some extra work and understanding of making the correct entries on the application instead of the convenient DRT function.  Once done and submitted, parents would receive their initial EFC and should also then print the Student Aid Report (SAR).  Then, after the initial submission, parents can turn-on the DRT function and check to be sure their initial submission was accurate.  Parents can also wait until the final college choice is made and then re-submit the FAFSA using the DRT so the chosen college can verify the FAFSA information.  Of course, differences in the original submission and the DRT version may trigger an amendment to the aid award, but if applicants are careful in their submission, amendments may not happen.  Using the DRT may not be a good idea if parents’ present income situation is materially different than in 2016.  In this case, completing the FAFSA without the DRT at all and submitting supporting material (copies of tax returns, W-2 forms, etc) may be the best strategy.

For those who are unsure about filling out the FAFSA themselves, the Rhode Island Student Loan Authority’s College Planning Center is a good resource for RI families.  Contact them at