NAICU Washington Update

IRS Data Retrieval Tool Restored for 2018-19 Financial Aid Cycle

October 03, 2017

The Internal Revenue Service (IRS) and the Department of Education have restored the IRS Data Retrieval Tool (IRS DRT) to help students and families apply for federal financial aid.  The restoration of the IRS DRT allows students to once again use the online tool to fill out the Free Application for Federal Student Aid (FAFSA). Using the IRS resource, students are able to skip some questions on the FAFSA by transporting and prepopulating answers to certain questions with family income data gathered from the IRS.
The tool was unexpectedly disabled in March 2017 after reports of tampering. IRS Commissioner John Koskinen testified to Congress that identify thieves had targeted the personal information of up to 100,000 FAFSA filers, and that the IRS had issued 8,000 fraudulent refunds totaling approximately $30 million.  According to the Department, additional security and privacy protections have been added to address concerns that data from the tool could be used by identity thieves to file fraudulent tax returns.
With the move to prior-prior year tax information to determine financial aid eligibility beginning in the 2017-18 academic year, the financial aid cycle for the subsequent academic year now begins on October 1. Therefore, the IRS DRT will be available for the entire 2018-19 application cycle. Students filling out FAFSA applications for the 2018-19 cycle will use tax information from the 2016 calendar year to determine financial aid eligibility. 

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