Verification (Title 34, Code of Federal Regulations, §668.51-61)

Verification is the process of confirming the accuracy of student reported data on the Free Application for Federal Student Aid (FAFSA). For any academic year, the Office of Student Financial Aid verifies one hundred percent Central Processing System (CPS) selected verifications.

Verification is a review, mandated by law, conducted by the Financial Aid staff wherein the applicant’s FAFSA is compared to external documents, such as the federal income tax return transcript, in order to substantiate FAFSA data.

Students, parents, and spouses are reminded that by signing FAFSA and certain other financial aid documents, they are agreeing, if asked, to provide information that will verify the accuracy of their completed forms. The student is ineligible for financial aid if the student, parent(s), or spouse refuses to submit verification documents as requested.

Selection of Applications to be Verified

The Financial Aid office verifies those applicants identified by the U.S. Department of Education (DOE) through the Central Processing System (CPS). In addition, Financial Aid advisors may select a student for verification if there is a discrepancy or a condition that is unusual and warrants investigation.

If FAFSA reflects significant numerical improbabilities—such as a tax liability number that is equal to, or that exceeds, the adjusted gross income—the applicant may be non-randomly selected for verification in order that the Financial Aid staff can correct the apparent discrepancy.

The Financial Aid Office staff is required, by federal regulation, to resolve any discrepancies that are created by information submitted at any point that conflicts with that already in a student’s file.

Resolution of discrepancies may result in a revision to a student’s aid amounts and/or types. Depending upon the nature of the discrepancy, the Financial Aid staff may be required to correct a student’s financial aid awards for a past year (or years), whereupon Hunter Business School will bill the student for previously disbursed aid.

Verification Exclusions

There are times when Financial Aid advisors need to verify a student’s application. Except in the case of the student’s death, however, none of the exemptions excuse Financial Aid advisors from the requirement to resolve conflicting information.

Financial Aid advisors must identify and document in the aid folder why the student is not required to complete verification. Other information not excluded must still be verified according to all other requirements.

Hunter Business School does not have to verify FAFSA information of a student in the following situations.

  • An applicant died during the award year.
  • A dependent student’s parents cannot comply because of specified reasons (e.g., parents are deceased, are physically or mentally incapacitated).
  • The students is eligible only for an unsubsidized loan. (Requesting an unsubsidized loan in lieu of need-based aid to prevent the verification process is not possible.)
  • An independent student’s spouse has died; is mentally incapacitated; resides in another country and cannot be contacted by normal means; or cannot be located because the student does not have and cannot get his/her contact information.
  • A student does not receive Title IV funds. (Title IV of the Higher Education Act of 1965 covers the administration of the United States Federal Student Aid programs.)
  • A student was selected for verification after ceasing to be enrolled and all disbursements (including late disbursements) were made.

Hunter Business School will not accept verifications performed by other institutions. Therefore, if a student is selected for verification, said student must supply all necessary verification documents before receiving any Title IV funds.

Verification Time Frame

Hunter Business School reserves in person appointments for every financial aid recipient. During this appointment, applicants selected for verification are informed of the necessary documents and process for completing their verification.

If the Financial Aid Office has received U.S. Department of Education information identifying the student as being selected for verification, the Financial Aid Office will request the appropriate verification documents (e.g., verification worksheets, student and parent tax returns). Please note that the student must submit all verification documents to the Financial Aid Office within 10 days of class start.

Students are notified that until the missing items are submitted to the Financial Aid Office, their awards are estimated and can change during the verification process. If a student’s Estimated Family Contribution changes through the verification process, Hunter Business School will make the necessary adjustments to their aid package and inform the student, as appropriate.

If a student submits documentation that appears fraudulent, a Financial Aid Office staff member must notify the Corporate Financial Aid Director.

Documentation

Documentation submitted to the Financial Aid Office must be legible, appropriate, and have the student’s Social Security number for identification purposes. If the student submits a document which is not legible, not appropriate, or not identifiable, the documents will be returned and a request for additional documentation will be made.

These are some examples.

  • Copy of a tax return transcript in which the income numbers are not identifiable
  • W-2 submitted instead of a tax return transcript
  • Student submits a copy of the stepparents’ tax return, the last name does not match the student’s, and there is no link to the student by identifiers

If possible, the return of documentation is recorded on the student’s account in the comment section of the academic year screen.

Verification worksheets have been constructed to assist students and parents with the collection of verification data. All verification worksheets must be clearly identifiable and signed at the time of verification. Students are warned that any false or misleading information could result in fine and punishment.

Students and parents are encouraged to use the IRS (Internal Revenue Service) Data Retrieval Tool embedded within the online FAFSA application. Using the Data Retrieval Tool is the fastest, easiest, and most secure method of meeting the verification requirements. However, if a student or parent is unable to, or declines to, use the Data Retrieval Tool, acceptable copies of tax information are mandatory to continue the verification process.

If a student or parent has filed an amended tax return, a Financial Aid advisor will need a signed copy of IRS form 1040X that was filed and a signed copy of the original tax return that was filed; a tax return transcript (which does not have to be signed); or any IRS transcript (such as a Return Transcript for Taxpayer) that includes all the income and tax information required to be verified. This includes adjusted gross income, income, taxes paid, education credits, etc.

The high school completion requirement can be satisfied with a high school diploma or transcript, GED (General Equivalency Diploma) certificate or transcript, transcript showing the completion of a two-year program, or home school credential or transcript.

Identity/Statement of Educational Purpose can be satisfied with an original government issued photo ID and signed statement of educational purpose. Since Hunter Business School’s Financial Aid Office reserves in person appointments, it is encouraged that all students with this requirement submit the necessary documents at the time of their appointment.

A Financial Aid advisor is responsible for documenting the applicant’s name and date the document was received and processed. Once received, the Financial Aid advisor is responsible for updating the Financial Aid Application (FAA) Access to the Central Processing System’s (CPS) online Identity Verification Results using the Identity Verification Results feature. The confirmation page from FAA Access to CPS online must be retained in the student’s file as proof the process was completed.

If a parent, student, or spouse has filed a tax extension (Form 4868 Application for Automatic Extension of Time to File U.S. Individual Income Tax Return) with the IRS, verification can be completed provided that the person submits all income information that will be used to file the necessary tax return (W-2s, or if the individual is self-employed, a signed statement with the amount of adjusted gross income and that the corresponding U.S. taxes have been paid).

Data Retrieval Tool

If a student has used the Data Retrieval Tool and did not manipulate the information, the IRS request field on the Institutional Student Information Record (ISIR) will have a value of “02.” This is the only acceptable verifiable Data Retrieval Tool field value.

If a student or parent declined to use the IRS Data Retrieval Tool or used it but manipulated the information, further investigation will be necessary to determine if a tax return transcript is available. There are various reasons why a student or parent may not have been able to use the Data Retrieval Tool. (Please refer to the verification chapter in the Application and Verification Guide of the Federal Student Aid Handbook.)

All applicants selected for verification, regardless of Verification Tracking Group, who retrieve and transfer their income tax return information, unchanged, using the IRS Data Retrieval Tool are considered to have verified the FAFSA IRS information that follows below, as applicable. This applies either when initially completing FAFSA on the Web (FOTW) or through the corrections process of FOTW.

  • Adjusted gross income
  • Federal income tax paid
  • Untaxed portions of IRA distributions
  • Untaxed portions of pensions
  • IRA deductions and payments
  • Tax exempt interest income
  • Education benefits

Username and Password

Students will create a username and password to authenticate their identity when accessing FAFSA. Rather than entering their Social Security number, name, date of birth, and PIN (personal identification number) to perform functions such as starting a renewal FAFSA, signing a FAFSA, making FAFSA corrections, or accessing the IRS Data Retrieval Tool, a user will enter a Federal Student Aid ID. This will eliminate the use of personally identifiable information and resolve the issue of multiple PIN assignments for one individual when identifiers change due to life circumstances.

Non-Tax Filers

For non-tax filers, Financial Aid advisors must receive a W-2 form for each source of employment income. The student must supply a signed statement listing the sources and amounts of income earned from work not provided on the W-2 and certify that a tax return has not been, nor is, required to be filed. This must be done by submitting an IRS Verification of Non-Filing Letter which can be obtained through the IRS. Please note that dependent students do not need a Verification of Non-Filing Letter.

Persons from a foreign country who are not required to file a tax return can provide a signed statement certifying their income and taxes paid. If a person must provide a W-2 form but cannot do it in a timely fashion, he or she may contact the IRS for a W-2 wage transcript. If a W-2 wage transcript is not available for the person, submission of a signed statement with the amount and source of income earned from work and the reason the W-2 is not available at this time is acceptable.

Persons who submit a W-2 showing wage income over the IRS threshold for non-filing will be required to file a federal income tax return before verification can be completed. Likewise, any person who has filed tax information incorrectly will be required to amend that tax information before the verification process can commence (e.g., married couple; living together; one filed as head of household and the other filed single). Non-tax filers will also be required to verify household size, enrollment in the Supplemental Nutrition Assistance Program (SNAP), and child support paid (if listed on FAFSA).

If a Financial Aid advisor questions a claim that the tax filer has not, will not, and is not required to file an IRS income tax return, Hunter Business School must require the applicant to submit an IRS Verification of Non-Filing Letter from the IRS confirming that the tax filer did not file an IRS income tax return. The request for Verification of Non-Filing can be obtained by the tax filer using IRS Form 4506-T and checking box 7.

Document Collection Procedures

When all required documents have been received, the student is considered complete and ready to be packaged as approved. The student’s account is updated, and she or he will receive an updated award letter if any previous financial aid awards have changed.

Processing Time Frame

From the date a student submits the required documentation to complete the verification process, a Financial Aid advisor will process the documents, update or correct the Institutional Student Information Record (ISIR), and provide the student with an updated award letter to sign and accept. Processing of verification typically takes about two weeks from the time all required documents are submitted.

Failure to Comply

Students who fail to submit verification documents never become complete. Therefore, aid will not be approved for these students. Students who do not complete their file will be notified and informed that a payment plan must be prepared in order to remain enrolled at Hunter Business School.

Submission After Deadline

Students who submit verification documents very late after the time they were requested will be awarded aid on an availability basis. Typically, by the end of the academic year, aid funds beyond federal loans and the Federal Pell Grant are depleted.

Students are encouraged to submit their documents during the time of their enrollment, however, Hunter Business School will process a late submission of verification documents up to 120 days after the student’s enrollment or the published deadline established by the U.S. Department of Education for a Pell Grant applicant, whichever is earlier. Campus-based and Stafford (Direct) Loan applicants must complete verification by the same deadline.

Notice of Verification to Applicants

Students are notified that they are selected for verification on the Student Aid Report (SAR). In addition, Hunter Business School’s Financial Aid advisors will inform students in person of their verification selection status and the necessary documents to complete the verification process. Once again, verification must be completed within 10 days of the start of class.

Verification of Data Elements

Hunter Business School verifies only those data elements required by the federal government. However, Financial Aid advisors are free to ask for additional information if further investigation is needed to resolve a discrepancy.

The Financial Aid department’s long-term goal is for a customized approach to verification. A menu of potential verification items for each year are published in the Federal Register, and the items to verify for a given application will be selected from that menu and indicated on the student’s output documents.

Verification is determined by three tracking groups. Students who are selected for verification will be placed in one of the three tracking groups. (Although there are six groups listed, all tracking groups are not used and have been reserved for future use until determined by the U.S. Department of Education.) The group determines which FAFSA information must be verified for the student. The Verification Tracking Groups are noted below.

Standard Verification Group
Tracking Flag V1

Students selected in this verification group are required to provide information for all of the following noted below.

Adjusted Gross Income – This is verified by comparing a copy of the student’s, spouse’s, or parent’s income tax transcript to the Institutional Student Information Record (ISIR) data. Discrepancies must be corrected before further processing.

Federal Income Tax Paid – U.S. income tax paid is verified by comparing a copy of the student’s, spouse’s, or parent’s income tax transcript to ISIR data. Discrepancies must be corrected before further processing. On an IRS 1040A or 1040EZ transcript, it is notated as Total Tax Liability TP Figures Per Computer. On an IRS 1040 tax return transcript, it is notated as Income Tax After Credits Per Computer.

Untaxed Portions of IRA Distributions
This information is located on the tax return transcript. The calculation is determined by comparing the amount of taxable IRA (individual retirement account) distributions to the total amount distributed. If there is a difference between the two, the untaxed portion must be listed as untaxed income on FAFSA. If it is listed on FAFSA, compare the amounts to determine accuracy. If not, Financial Aid advisors must correct FAFSA to the amount determined by the tax return transcript.

Untaxed Portions of Pensions – This information is located on the tax return transcript. The calculation is determined by comparing the amount of taxable pension distributions to the total amount distributed. If there is a difference between the two, the untaxed portion must be listed as untaxed income on FAFSA. If it is listed on FAFSA, compare the amounts to determine accuracy. If not, Financial Aid advisors must correct FAFSA to the amount determined by the tax return transcript.

IRA Deductions and Payments – This information is located on the individual W-2, located in box 12. (Please see the attachment to your W-2 form for an explanation of deductions.)

Tax-Exempt Interest Income
This information is located on the tax return transcript as Tax-Exempt Interest.

Education Credits – This information is located on the tax return transcript as Education Credits Per Computer.

Supplemental Nutrition Assistance Program (SNAP) Benefits – This information is self-reported on the FAFSA application. Should the information need to be verified, the student and/or parent can confirm receipt directly on the verification worksheet, present a signed statement labeling the recipients, or provide a copy of the benefits letter from the issuing agency.

Child Support Paid – This information is self-reported on the FAFSA application. Should the information need to be verified, the student and/or parent can confirm payment directly on the verification worksheet, present a signed statement labeling the recipients and who pays child support, or provide a copy of the court documentation or divorce decree noting the obligation and who is responsible for payment and for which children.

Household Size – Household size is verified by comparing the verification worksheet to the Institutional Student Information Record (ISIR) data. A properly completed verification worksheet serves as verifiable data for accuracy or correction purposes.

Discrepancies must be corrected before further processing. All applicants must update household size or number of household members in college to be correct as of the date of verification, unless the update is due to a change in the student’s marital status.

  • Although regulations allow situations when verification of household size is not required (see the U.S. Department of Education Application and Verification Guide), the Financial Aid Office does not have a systematic way to track these exclusions. Therefore, all students selected for verification must submit a response to the household size question on the verification worksheet.
  • The number of household members for dependent students must now include both of a dependent student’s legal (biological or adoptive) parents if the parents live together, regardless of the marital status or gender of the parents (see Dear Colleague Letter).

Number of Persons in College – The number of family members enrolled at least halftime in postsecondary institutions is verified by comparing the verification worksheet to ISIR data. Discrepancies must be corrected before further processing.

Custom Verification Group
Tracking Flag V4

High School Completion Status and Identity/Statement of Educational Purpose – Students must verify high school completion status and Identity/Statement of Educational Purpose in addition to SNAP benefits and payment of child support.

A properly completed Identity/Statement of Educational Purpose form, coupled with a valid government issued identification card and a high school diploma or high school transcript showing a graduated status from an accredited school, serves as completion of this verification group.

Financial Aid advisors are required to report the results from students selected in this tracking group by the Central Processing System (CPS) into FAA [Financial Aid Application] Access to CPS Online. Only those students selected for this flag by the processor should be entered into the FAA Access to CPS Online.

Aggregate Verification Group
Tracking Flag V5

Students must verify high school completion status and submit a properly completed Identity/Statement of Educational Purpose form, in addition to the items in the Standard Verification Group (V1). A valid government issued identification card and a high school diploma or high school transcript showing a graduated status from an accredited school serves as completion of this verification group.

Financial Aid advisors are required to report the results from students selected in this tracking group by the Central Processing System (CPS) into FAA [Financial Aid Application] Access to CPS Online. Only those students selected for this flag by the processor should be entered into the FAA Access to CPS Online.

If the Financial Aid advisor determines that the amounts provided and verified from other income information (e.g., adjusted gross income, income earned from work, untaxed income not included on FAFSA) do not appear to provide sufficient financial support for the number of household family members reported, the applicant and, if appropriate, the applicant’s parents or spouse, must explain how the family was financially supported during the calendar year. Financial Aid advisors will use the Low Income Explanation form to determine the family’s income and resources.

Institutional Discretionary Items

The Financial Aid Office verifies those applicants identified by the U.S. Department of Education. Financial Aid advisors may select a student for verification if there is a discrepancy or a condition that is unusual and warrants investigation. If a student submits verification documentation (e.g., tax transcripts), the Financial Aid staff must verify the information on the document against the information in the student’s file.

Notification Verification Is Complete

Students receive an award letter confirming the sources and amount of financial aid awarded after verification has been completed. Students sign a new award letter if the estimated aid has changed, and if not, the student’s original award letter is sufficient.

Correction Procedures

If corrections are needed, the student will be required to amend the incorrect FAFSA information. This will result in a subsequent Student Aid Report (SAR). Once received, verification will be done on the updated information. For students selected for verification who are receiving subsidized aid, changes that result to any non-dollar item and to any dollar item of $25 or more must be submitted for processing.

Conflicting Information for Non-Selected Applicants

Financial Aid advisors are required to resolve any discrepancies discovered in a student’s file. Aid advisors will use all information noted in the student’s file, and from other departments, to determine if conflicts exist. Students are responsible for complying with any information Financial Aid advisors request to clear conflicting information. Students will be informed of which documents to submit to rectify the conflict.

Updating Information

Generally, a student cannot update information that was correct as of the date the application was filed because FAFSA is considered to be a snapshot of the family’s financial situation as of that date. After FAFSA is signed, only certain items can be updated under the following described conditions.

All applicants whose dependency status changes must update that status and the associated FAFSA information throughout the award year, except when the update is caused by a change in the student’s marital status.

All applicants selected by the U.S. Department of Education or Hunter Business School for verification of household size or number in college must update those numbers to be correct as of the date of verification, unless the update is due to a change in the student’s marital status.

Hunter Business School will not update the above due to a marital status change unless it is deemed necessary to address an inequity or to reflect more accurately the applicant’s ability to pay. Each decision will be made on a case by case basis, and the reason must be well documented in the student’s file. The new Estimated Family Contribution will be used to award and disburse all Title IV (Higher Education Act of 1965) aid.

Interim Disbursements

Hunter Business School does not disburse any student’s Title IV aid until verification is complete and a subsequent Institutional Student Information Record (ISIR) has been received and verified.

On occasion, there may be instances where it is warranted to disburse funds on an interim basis to a student. Those students will be handled on a case by case basis and thoroughly documented as to why. Students receiving Direct Loan funds may have their loans originated but will not be eligible to receive an interim disbursement until verification is complete.

Selection After Disbursement

A student’s application might be selected for verification after corrections are submitted and the student has been paid based on the previous unselected Central Processing System (CPS) transaction.

Financial Aid advisors must verify the applicant before making any subsequent or further disbursements. If verification does not justify aid already disbursed, Hunter Business School will make the necessary adjustments to the aid package, and the student will be responsible for repaying all aid for which he or she was not eligible, with the exception of Stafford (Direct) Loans.

Submitting Changes

Changes are submitted to the Central Processing System (CPS) through FAA [Financial Aid Application] Access to CPS Online. A corrected Institutional Student Information Record (ISIR) should be received by Hunter Business School within 72 hours. Once the verified ISIR is received, Hunter Business School will award and disburse aid on that particular transaction.

Late Disbursements

Generally a student ceases to be eligible for aid once she or he has finished the payment period and is no longer enrolled. However, the student may submit verification documentation and receive a late disbursement after that time if the U.S. Department of Education processed a Student Aid Report (SAR) or Institutional Student Information Record (ISIR) with an official Expected Family Contribution (EFC) while he/she was still enrolled.

Direct loan disbursements require origination, entrance counseling, and Master Promissory Note signatures before the student terminated enrollment in order to be considered for a late disbursement.

Verification Following Disasters

The Secretary for Postsecondary Education will not enforce verification requirements during the award year for applicants whose records were lost or destroyed because of a disaster. Hunter Business School will document when a student is not required to have verification performed due to this status. Pell Grant disbursements will be documented with a status code of “S” in the Common Origination and Disbursement system.