Mapping Your Future: Tax Return Matrix released for upcoming verification season

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Tax Return Matrix released for upcoming verification season

By Catherine Mueller

November 24, 2020

The holidays are just beginning, but the Department of Education already released a gift to help financial aid professionals in the upcoming verification season.

In a November 20 Electronic Announcement, the Department of Education announced the release of the 2021-2022 FAFSA Verification-IRS Tax Return Transcript Matrix that institutions can use for 2021-2022 verification of IRS tax return information included on the Free Application for Federal Student Aid (FAFSA) application.

According to the Announcement, because the IRS Tax Return Transcript does not have line or item numbers and uses wording that may be different from what is used on the FAFSA, the matrix may help financial aid administrators map 2019 IRS Tax Return Transcript information to FAFSA/ISIR data.

Following are descriptions of the information in each column of the matrix:

  • The first column of the matrix lists the six 2021-2022 FAFSA information items that may need to be verified for a student or parent who indicated that they did or will file a 2019 IRS tax return.
  • The second column displays the student and parent FAFSA question number for each item.
  • The third column displays the student and parent ISIR item number.
  • The fourth column of the matrix is the item name as displayed on the IRS Tax Return Transcript.
  • The last column shows the corresponding line item numbers from the 2019 IRS 1040 tax return.

In the Announcement, the Department notes that for some items the transcript may display two or three values for an item. If only one value is displayed on the transcript, that value must be used for verification. If more than one value is displayed on the transcript, the value associated with the item name that includes the words “Per Computer” must be used for verification. The “Per Computer” line should be used for verification even if it is different than what was reported by the tax filer.

Under provisions of the Higher Education Act (HEA), taxes and credits related to the Affordable Care Act (ACA) are not to be included in the amount of U.S. Taxes Paid that are used in the calculation of a student’s expected family contribution (EFC).