The Future Actrequires that every contributor on the FAFSA provide consent to share their taxes information in the application so that the IRS can share this information with Federal Student Aid (FSA). All parties whose Federal Tax Information (FTI) is included on a student’s FAFSA form must consent annually.
The consent will be required when a student submits a FAFSA, chooses Income-Driven Repayment (IDR) when starting loan repayment, or submits the Total and Permanent Disability discharge (TPD) within the U.S. Department of Veterans Affairs for totally and permanently disabled students.
The consent is necessary not only for the Department of Education to request federal tax information from the IRS but also to use that FTI in the federal student aid application process, as well as do other things such as redisclose that information to certain eligible entities, such as higher education institutions.
What happens if I, as a student, or a spouse or parent, don’t want to provide consent on the FAFSA?
If a student, spouse, or parent doesn’t provide consent on the FAFSA, the Student Aid Index (SAI) will not be calculated, and the student will not be eligible for any federal aid.
What if I had a low income and was not required to file taxes?
According to theIRS tax year 2022, these are the thresholds by filing status. If an independent student (and spouse, if married), or a parent of a dependent student, were not required to file a federal income tax return for 2022, then the student will automatically receive a Student Aid Index (SAI) equal to –1500. They still need to provide consent when submitting the FAFSA, so the IRS can confirm to Federal Student Aid (FSA) the student, parents, and spouse didn’t file taxes.
Will students still be able to use the IRS Data Retrieval Tool?
No. Starting FAFSA 2024-25, the DRT will no longer exist. After the student, spouse, and/or parent provides consent to the Direct Data Exchange (DDX), the Federal Tax Information (FTI) will be linked to the application contributor. Federal Student Aid (FSA) will now directly transfer Federal Tax Information (FTI) from the IRS into the FAFSA form as long as the user has provided FSA with the consent to do so.
All users identified as required contributors on a particular FAFSA form will be prompted to provide consent for the IRS to use their Federal Tax Information (FTI). This consent is required to retrieve FTI from the IRS to calculate the student’s aid eligibility. If any party to the FAFSA form does not provide consent, submission of the form will still be allowed. However, a Student Aid Index (SAI), which replaces the Expected Family Contribution (EFC), will not be calculated.
Will non-custodial parents be contributors if they have not claimed the child on their taxes?
Starting with the Simplified FAFSA, students will determine which parent to report based on which one provides the most financial support. It is ok if the parent or parents reported do not claim the student on their taxes. The reported parents will provide consent to transfer their taxes data even if they do not claim the student on their taxes.
If parents that are remarried provide more support to the child than a biological parent, does the stepparent have to provide their taxes information?
Yes. If the parent providing more financial support is remarried, the stepparent’s tax information is required.
What if my parent or stepparent does not want to provide their tax information for my FAFSA?
Our Counselors can offer to talk directly with the parent or stepparent to explain why that information is needed and answer any questions, which sometimes puts them at ease about how their sensitive info will be used. However, we cannot provide tax advice.
How do I report small business or farm value as assets on the FAFSA?
Independent students or parents are the best sources for this estimate; they can also consult their accountant or other financial professional if they have access to one to estimate the amounts to report.
I – and/or my parents or spouse – amended our taxes. Will the Federal Tax Information (FTI) transfer the amended tax information?
Yes. Starting 2024-25, when the student, spouse, parent, and/or stepparent provide consent, the IRS’s Federal Tax Information (FTI) will include the information from an amended tax return.
Can I self-report my income on FAFSA?
After you provide consent on the FAFSA, if the IRS cannot transfer your Federal Tax Information (FTI) to your FAFSA application, the application will allow you to self-report it. Self-reporting one’s tax information on the FAFSA does not override the requirement for each required contributor to provide consent on the FAFSA form.So two pieces – they need to provide consent, and we need to have their tax information, either directly from the IRS or self-reported manually on the FAFSA form.
If a FAFSA contributor is a non-filer and has zero wages, do they have to provide consent?
Any individual who is a contributor to the FAFSA application must provide consent.
What happens if a contributor provides consent but doesn’t sign the application?
Starting 2024-25, there will be only two options for filing a FAFSA form: electronically, throughstudentaid.gov, or the option to file on paper which will also be available. However, once an application is started online, all parties must complete it online. If a signature is missing, the parent or the contributor that needs to complete their section and/or sign the application must obtain an FSA ID and complete their section.
There is no option to print a signature page any longer. For this reason, financial aid administrators will not be able to submit complete FAFSA forms because of the consent provision that all contributors must provide and sign.
Students and parents will be required to have an FSA ID to complete the FAFSA application online. If they choose to mail a paper FAFSA, both will need to provide consent on the paper FAFSA, and both will need to provide wet signatures and mail the application to the Department of Education address on the paper application. This method is not recommended due to complexity and increased processing time.
In what situations will there be a match with IRS, but IRS wouldn’t provide information?
Fraud or identity theft are the most likely reasons for the IRS not providing tax information to the applicant or the contributor. If the contributor has been flagged by the IRS, possibly due to identity theft or a breach of information, then the IRS response code will be IRS unable to provide information.
If a parent does not want to or refuses to create an FSA ID, is there an alternative for that parent to provide consent, such as mailing a wet signed consent page?
There is no longer a separate signature page, and there won’t be a paper consent signature option. If a parent refuses to create an FSA ID then the FAFSA will need to be completed via the paper application and contain wet signatures from all contributors, including the parents, who affirm their consent. The application will then need to be mailed to Federal Student Aid processors. This method is not recommended due to complexity and increased processing time.
