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ETSU spells out financial aid changes

Rex Barber • Jan 30, 2012 at 8:17 AM

Changes to the financial aid process for college this year could lead to frustration for some, so East Tennessee State University is trying to get word out about the changes.

Margaret Miller, director of ETSU’s financial aid office, said the two biggest changes surround providing documentation for food stamps and securing IRS transcripts.

Each year college students or their parents who seek financial aid for school must fill out the Free Application for Federal Student Aid (FAFSA).

One question on this form asks if the applicant received food stamps. To cut down on fraud, the Department of Education will require anyone answering yes to that question this year to provide proof of food stamp eligibility from the Department of Human Services, Miller said.

“I think the Department of Education decided there were too many people answering yes to that question, so they could automatically be considered for the highest level of help,” Miller said.

This policy grew out of Congress’ desire to get education spending under control while at the same time maintaining funds for people who need them, Miller said.

The letter from DHS must be sent immediately, separate from the FAFSA, to the school to which the student is attending.

For ETSU, send the DHS letter to ETSU Financial Aid, Box 70722, Johnson City, TN 37614, or bring the letter to Dossett Hall, Room 105 on the ETSU campus.

ETSU verification clerk and financial aid assistant Vanessa Hawkins said this change could slow down the financial aid process, because it requires a letter that is sent apart from the actual FAFSA.

“It will slow the process down very much for people we would never have questioned,” Hawkins said. “But we’re hoping if we get the word out they can go ahead and send it in. And we’ll have it waiting and ready and we can have their folder waiting if they’re not selected for verification.”

The change involving the IRS has to do with FAFSA verification. FAFSA’s are randomly selected for verification every year. Forty percent of ETSU students who file a FAFSA are randomly selected for verification. Of those students, 80 to 90 percent need a correction to their FAFSA.

In prior years, if a student’s FAFSA was selected for verification, the only information from the IRS that student or his or her parent was required to provide was a signed copy of that year’s tax return.

Now, the Department of Education will require something called an official IRS transcript for verification purposes. But depending on circumstances, this could make things easier or harder.

For the 2012-13 FAFSA, for anyone who has already filed their 2011 taxes, an option will be available to allow the school to pull needed information directly from the IRS.

If the automatic IRS data retrieval option is not used and a student is selected for verification, that student will now have to provide a tax return transcript, which is a form that must be specifically requested from the IRS. This transcript is a wholly different form from a tax return.

Miller said transcript forms can be difficult to get, so she encouraged people to check the box for the automatic IRS information retrieval if they have already submitted their 2011 tax return.

To make sure students know about the changes and avoid potential problems, ETSU administrators have arranged for school counselors to set up stations around campus this semester to answer questions and review a student’s FAFSA for problems and make corrections.

The school did this last year, but is expanding the service this year.

Counselors are also attending freshman college orientation classes to explain financial aid and how to navigate that process, as well as the changes to this year’s process.

The school is sending out announcements about these changes via email.

Still, Miller expects to encounter hangups with the process this year.

“It’s going to be different enough from what people have had to do,” Miller said.

Eventually, though, these changes, especially the IRS transcript retrieval change, will be beneficial, Hawkins thinks.

“I think being able to have the transfer of information will relieve some of our verification problems, once everybody gets used to doing it,” Hawkins said.

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