You May, You Must, You Don’t Have to, You Cannot A Verification Quiz

1. You May, You Must, You Don’t Have to, You CannotA Verification Quiz Kathy Tipton Guilford Technical Community College NCASFAA/SCASFAA Fall 2006 Conference

2. 1 • A student (may, must, cannot) update income or asset information to reflect changes to the family’s financial situation that took place after the FAFSA was filed.

3. 1 Answer • Cannot. “A student cannot update income or asset information to reflect changes to the family’s financial situation that took place after the FAFSA was filed. For example, if her family sold some stock after she signed a FAFSA and spent the money on a non-reported asset such as a car. She can’t update her information to show a change in the family’s assets.”

4. 2 • If you require students to provide you with information other than what appears on the FAFSA in order to apply for institutional or private aid, you (must, cannot) take that additional information into account in your awarding of Title IV aid.

5. 2 Answer • Must. “The FAFSA is the only form all students must fill out to apply for Title IV aid. A school cannot require extra information from students except for verification or resolving conflicting information. But a school may require extra information for other purposes such as packaging private or institutional aid, and if the school does this or is otherwise aware of information that is related to Title IV need and eligibility, it must take the information into account when awarding Title IV aid.”

6. 3 • A school (may, must, doesn’t have to) verify any application information that it has reason to believe is incorrect.

7. 3 Answer • Must. “A school must verify any information that it has reason to believe is incorrect [34 CFR 668.54(a) (3)] or discrepant [34 CFR 668.16 (f)].”

8. 4 • Students selected by the school (must, may, don’t have to) be held to the same deadlines and allowable tolerances as those selected by CPS.

9. 4 Answer • Must. “The school may also select additional applications for verification beyond those required, and in these cases the school decides which items to verify: it can choose any that must be verified on CPS-selected applications, or it can choose different items. Regardless of whether the CPS or the school selected the application for verification, all other verification requirements, such as deadlines and allowable tolerances and interim disbursement rules, apply equally to all students who are being verified.”

10. 5 • A School (may, may not) choose to verify more than 30% of all applications.

11. 5 Answer • May. The school may choose to verify more than 30%...

12. 6 • If CPS selects less than 30% of the applications for verification, the school (may, must, doesn’t have to) verify enough applications to reach 30%.

13. 6 Answer • Doesn’t have to. “The school may choose to verify more than 30%, and if the CPS selects less than that, the school isn’t required to reach 30%; it is not a quota.”

14. 7 • A selected application (may, must, doesn’t have to) be verified if the student is an immigrant who arrived in the US during calendar years 2006 or 2007.

15. 7 Answer • Doesn’t have to. “A selected application does not have to be verified if the student is an immigrant who arrived in the United States during calendar years 2006 or 2007.

16. 8 • A selected application (isn’t, may be) exempt form some or all of the verification requirements due to unusual circumstances.

17. 8 Answer • May be. “A selected application may be exempt from some or all of the verification requirements due to unusual circumstances. Except in the case of the student’s death, however, none of these exemptions excuse the school from the requirement to resolve conflicting information.”

18. 9 • Schools participating in the Quality Assurance Program (may, must) develop verification procedures different from those specified in the FSA regulations.

19. 9 Answer • May. “Also note that schools participating in the Quality Assurance Program can develop verification procedures different than those specified in the FSA regulations.”

20. 10 • A school (may, doesn’t have to) verify a student who withdraws without receiving aid.

21. 10 Answer • Doesn’t have to. “You don’t have to verify a student who won’t receive FSA for reasons other than his failure to complete verification. This category includes students ineligible for aid from the FSA programs and those who withdraw without receiving aid.”

22. 11 • Schools (must, don’t have to) use the Federal Verification Worksheet or any other verification worksheet.

23. 11 Answer • Don’t have to. “…you’re not required to use the verification worksheets. Your school may use its own worksheet or none at all. You may require other documentation in addition to or instead of a completed verification worksheet.”

24. 12 • A school (must, doesn’t have to) verify Household size if it receives the student’s ISIR or SAR within 90 days after the application was signed.

25. 12 Answer • Doesn’t have to. “You don’t have to verify household size if any of the following apply:” (Four items listed, including “you receive the student’s ISIR or SAR within 90 days after the date the application was signed.

26. 13 • A school (must, may) accept a statement signed by the student (and at least 1 parent for dependent students) to verify Number in College.

27. 13 Answer • May. “Number enrolled in college: If the student completes the Department’s verification worksheet, no further documentation for this item is required. Instead of the worksheet, you may accept a statement signed by the student (and at least one of the student’s parents, for dependent students).”

28. 14 • AGI reported on the FAFSA (must, may) match the AGI on the tax return.

29. 14 Answer • May. “The AGI figures reported on the FAFSA should always match the AGI figures that appear on the tax return, unless the FAFSA amount has been adjusted from a joint return due to divorce, separation, or professional judgment.” (Emphasis mine.)

30. 15 • Schools (must, may, are not required to) verify Social Security benefits.

31. 15 Answer • Must/May. There is conflicting information on this. On page 84 of the AVG under the heading “Untaxed income and benefits” is the following: “For an application selected for verification, you must verify up to six specific types of untaxed income and benefits: Social Security Benefits, child support, IRA/Keogh deductions, foreign income exclusion, earned income credit, and interest on tax-free bonds.” And on page 95 under the heading “Verifying untaxed Social Security benefits” is the following: “You’re not required to verify social Security benefits unless you have reason to believe that benefits were not reported or were reported incorrectly.” (Emphasis theirs.)

32. 16 • Schools (must, may, cannot) originate, certify, and disburse Unsubsidized and Plus loans regardless of a student’s verification status.

33. 16 Answer • May. “As already mentioned, verification isn’t required for unsubsidized and PLUS loans. Therefore, schools can originate, certify, and disburse unsubsidized and PLUS loans regardless of a students verification status.”

34. 17 • Schools (must, may, cannot) certify a FFEL Stafford loan application or originate a Direct Stafford loan for a student who hasn’t completed verification.

35. 17 Answer • May. “You can certify a FFEL Stafford loan application or originate a Direct Stafford loan for a student who hasn’t completed verification, but you can’t disburse the loan.”

36. 18 • Financial aid professionals (may, must, are not expected to) have special knowledge or expertise regarding the US tax code.

37. 18 Answer • Are not expected to. (Really!) “Financial aid professionals are not expected to have special knowledge or expertise regarding the US tax code.”

38. 19 • If someone whose data were required on the FAFSA submits a signed statement claiming non-filer status and you have reason to believe that person would have been required to file a US tax return, this (may, must, doesn’t have to) be resolved. (Grammar courtesy of the Application and Verification Guide, 2006-07)

39. 19 Answer • Must. “If someone whose data were required on the FAFSA submits a signed statement claiming non-filer status and you have reason to believe that person would have been required to file a US tax return, this must be resolved.”

40. 20 • Schools (may, must, cannot) verify items other than the five major data elements required for verification: household size, number in college, adjusted gross income, US income tax paid, and untaxed income and benefits.

41. 20 Answer • May. “In addition to verifying these required items for CPS-selected students, you can choose to verify any other application items, requiring any reasonable documentation, in accordance with consistently applied institutional policies.”

42. 21 • Required signatures, such as signatures on worksheets or on copies of tax returns (may, may not) be collected after the verification deadline for that award year.

43. 21 Answer • May not. “Any required signatures, such as signatures on worksheets or on copies of tax returns, must be collected at the time of verification—they can’t be collected after the verification deadline for that award year.”

44. 22 • If any of the persons required to report information on the FAFSA will file, but hadn’t filed a tax return at the time of application and are not selected for verification, schools (may, must, don’t have to) verify the estimated information.

45. 22 Answer • Don’t have to. From “Resolving Conflicting Information, Anthony Jones, April 24, 2006: “What is not Conflicting Information under the Regulations: …FAFSA filed using estimated income.”

46. 23 • If any of the persons required to report information on the FAFSA will file, but hadn’t filed a tax return at the time of application, and haven’t filed at the time of verification, the school (may, must) accept as alternative documentation copies of the W-2 forms and, as proof that the IRS has granted a filing extension, either a copy of IRS form 4868 or a copy of the IRS approval of an extension beyond the automatic four-month extension.

47. 23 Answer • Must. “At the time of verification, the necessary tax returns should have been filed and must be used for verification. If a return hasn’t been filed by then and a filing extension was granted by the IRS, the school shall (MUST) accept as alternative documentation copies of the W-2 forms, and, as proof that the IRS has granted a filing extension, either a copy of IRS form 4868- Application for Automatic Extension of Time to File A U.S. Individual Tax Return, or a copy of the IRS approval of an extension beyond the automatic four-month extension.”

48. 24 • Household size or number in college (may, must, cannot) be updated unless the student is selected for verification.

49. 24 Answer • Cannot. “Unlike dependency status, household size or number in college cannot be updated unless the student is selected for verification. If he is selected, these items must be updated to be correct at the time of verification unless they changed due to a change in the student’s marital status, in which case updating is not permitted.” (Emphasis theirs.)

50. 25 • If a student is selected for verification, household size and number in college (may, must, cannot) be updated to be correct at the time of verification. (Unless the change is due to a change in the student’s marital status, in which case updating is not permitted.)