The IRS and the Department of Education have announced their initial solution to the Data Retrieval Tool process for the FAFSA. It will be available for the FAFSA submission year starting on October 1, 2017. The October 1, 2017 is the start of the FAFSA school year for 2018 – 2019.
In early 2017, the DRT system was suspended due to a security breach of the IRS Data while using the FAFSA and the Data Retrieval Tool (DRT). The new changes to the DRT process creates a lack of transparency and additional steps that may cause some concerns for families. The original intention of DRT system was to simplify the process and reduce confusion. These changes go against the original goals of why the DRT system was established.
We currently have additional questions into the Department of Education to get clarity on a few items regarding the DRT update. Listed below are the major changes:
- Data transferred to the FAFSA will now be encrypted to improve security and privacy
- DRT System will require FSA ID and 1040 information match as before
- Dollar amounts of the data transferred will not be displayed on the FAFSA or Student Aid Report (SAR)
- Consumer will not be able to change their DRT data submissions
- If filing Married and Joint, individual earnings will need to be inputted manually
- If DRT is used and a number is changed, a Code 400 or 401 will appear on the college submission report
- IRA rollover will require additional FAFSA questions that needs to be answered and inputted
Instead of viewing the tax return information, parents using the DRT will only see the words, “Transferred from the IRS”. This statement will be on both the FAFSA form and the Student Aid Report (SAR).
These changes cause a new set of concerns for me and anyone using the DRT system. The DRT will still be able to transfer tax data from the Internal Revenue to the FAFSA but now families will not be able to view the transferred income and tax information before the FAFSA is submitted. The data transferred will be hidden on both the FAFSA and SAR pages. The income portion of the FAFSA submission is a blind submission now.
It will be important for families to have a very good estimation of their EFC before they submit their numbers. The EFC PLUS System provides an excellent estimate and details of the EFC number for a family.
This new process was established to add a level of security and privacy but adds another set of problems for parents using the DRT. Since the information is not displayed, parents will not be able to make any corrections to the IRS DRT transfer items on the FAFSA form before or after submission. Corrections will need to be done by the financial aid administers at the colleges.
The DRT and Prior Prior were created to add simplicity to the FAFSA process and to encourage more families to complete the FAFSA. With these changes, there is an increased amount of uncertainty that is added to the process. As stated above, we have contacted the DOE with questions that need to be answered on these changes. Once our questions are answered, we will provide an update and recommendations on how the FAFSA submission should be done. We hope to have this information available by mid – September.