Special Edition Tax Tip 2012-08
College-bound students and their parents typically want to make every dollar and every minute of the college experience count including money spent on tuition and time spent on the college financial aid application process. The Internal Revenue Service is helping minimize the time spent on the completion of the Free Application for Federal Student Aid (FAFSA) form by automating access to federal tax returns with the IRS Data Retrieval Tool. This tool provides the opportunity for applicants to automatically transfer the required tax data onto the FAFSA form.
Here are some tips on using the IRS Data Retrieval Tool:
- Benefits The IRS Data Retrieval tool is an easy and secure way to access and transfer tax return information directly onto the FAFSA form, saving time and improving accuracy. Also, the increased accuracy reduces the likelihood of being selected for verification by the school’s financial aid office.
- Eligibility Criteria Taxpayers who wish to use the tool to complete their 2012 FAFSA form must:
- have filed a 2011 tax return;
- possess a valid Social Security Number;
- have a Federal Student Aid PIN (individuals who don’t have a PIN, will be given the option to apply for one through the FAFSA application process);
have not changed marital status since Dec. 31, 2011.
- Exceptions If any of the following conditions apply to the student or parents, the IRS Data Retrieval Tool can not be used for the 2012 FAFSA application:
- an amended tax return was filed for 2011;
- no federal tax return for 2011 has been filed ;
- the federal tax filing status on the 2011 return is married filing separately;
a Puerto Rican or other foreign tax return has been filed.
- Alternatives If the IRS Data Retrieval Tool can not be used and if the college requests verification documentation, it may be necessary to obtain an official transcript from the IRS. To order tax return or tax account transcripts, visit www.irs.gov and select Order a Transcript or call the Transcript toll-free line at 1-800-908-9946.
In the limited set of cases where an aid applicant, who has filed a tax return and attempted unsuccessfully to use the IRS Data Retrieval Tool or to obtain IRS Tax Return transcripts, needs a timely alternative for meeting the 2012-2013 verification requirements, the Department of Education generally advises that institutions may, until July 15, 2012, use a signed copy of the relevant (i.e., applicant, spouse, or parent) 2011 IRS Tax Return (Form 1040, 1040A, or 1040EZ, as appropriate) as acceptable verification documentation for the 2012-2013 award year. This situation is rare but could occur if, for some reason, the tax return has been filed but not yet processed to completion by the IRS.
In addition to helping reduce the time and effort involved in completing and submitting the FAFSA form through the IRS Data Retrieval Tool, the IRS offers money-saving information to college students and their parents. Important information regarding tax credits and deductions for qualifying tuition, materials and fees is available at the IRS Tax Benefits for Education: Information Center and in IRS Publication 970, Tax Benefits for Education both of which are available at www.IRS.gov.
- Free Application for Federal Student Aid (FAFSA)
- IRS Tax Benefits for Education: Information Center
- IRS Publication 970, Tax Benefits for Education ( PDF)
- Order a Transcript