Verification in 2025-2026

By Rick Cox and Siobahn Arbogast

The Department of Education has posted the federal register and accompanying Dear Colleague Letter for verification for the 2025-2026 award year. To read details, financial aid administrators can access these postings here and here.

As a reminder, colleges normally must report the results of verification of identity. Currently, this is unavailable, and schools have been unable to report verification results for 2024-2025. This is expected to become available for the 2025-2026 award year and will be reported through the FAFSA Partner Portal. The Department of Education should provide additional details once this becomes available, as well. Note that under normal deadlines, colleges must report the results within 60 days following your first request for verification documentation. If you need to make a change to previously reported information, the change should be reported within 30 days.

The following outlines items to be verified for the 2025-2026 award year for each verification group:

Tax Filers and Non-Tax Filers
▪ Family Size
Tax Filers
▪ Adjusted Gross Income
▪ Income Earned from Work
▪ U.S. Income Tax Paid
▪ Untaxed Portions of IRA Distributions
▪ Untaxed Portions of Pensions
▪ IRA Deductions and Payments
▪ Tax Exempt Interest Income
▪ Education Tax Credits
▪ Foreign Income Exempt from Federal Taxation
Non-Tax Filers
▪ Income Earned from Work

Identity/Statement of Educational Purpose

Tax Filers and Non-Tax Filers
▪ Family Size
▪ Identity/Statement of Educational Purpose
Tax Filers
▪ Adjusted Gross Income
▪ Income Earned from Work
▪ U.S. Income Tax Paid
▪ Untaxed Portions of IRA Distributions
▪ Untaxed Portions of Pensions
▪ IRA Deductions and Payments
▪ Tax Exempt Interest Income
▪ Education Tax Credits
▪ Foreign Income Exempt from Federal Taxation
Non-Tax Filers
▪ Income Earned from Work

PLEASE NOTE

U.S. tax filers: All items (with the exception of Foreign Income Exempt from Federal Taxation) will not need to be verified if the tax data is transferred directly from the IRS (FA-DDX). For tax filers whose information was not transferred directly from the IRS, and for Foreign Income Exempt from Federal Taxation, the filer must provide one of the following:

A transcript obtained at no cost from the IRS or other relevant tax authority of a U.S. territory or commonwealth or foreign government; or
A copy of the income tax return and the applicable schedules that were filed with the IRS or other relevant tax authority.

Family Size: If family size is transferred directly from the IRS and is not changed, it will not need to be verified. If it is not transferred directly from the IRS or is updated on the FAFSA, you must collect a signed statement that lists the name and age of each family member for the 2025-2026 award year and the relationship of that family member to the applicant. However, if the manually reported family size is the same as the information transferred from the IRS (FADDX), you are not required to verify the family size.

Statement of Educational Purpose: As a reminder, you must use the exact language provided by the Department of Education in the federal register on the Statement of Educational Purpose. Additionally, the applicant must present an unexpired valid government-issued photo ID.

Rollovers: If the Untaxed Portions of IRA Distributions or Untaxed Portions of Pensions contain a rollover, you must collect a signed and dated statement confirming the amount of the rollover. This is required whether or not the information is transferred directly from the IRS.

Non-Tax Filers: You must collect:

A signed and dated statement certifying
▪ That the individual is not required to file a 2023 income tax return; and
▪ The sources and amounts of earnings, other income and resources that supported that individual for the 2023 tax year
For individuals without an SSN, ITIN or EIN, the statement must indicate they do not have an SSN, ITIN, or EIN;
A copy of the IRS Form W-2 for each source of 2023 employment income received or an equivalent document; and
Except for dependent students, verification of non-filing for individuals who would file a return with a relevant tax authority other than the IRS dated on or after October 1, 2024.

If a non-filer is unable to obtain the required verification of non-filing status from the relevant tax authority and the college has no reason to question the student’s or family’s good-faith effort to obtain the required documentation, the college may accept a signed statement certifying that the individual attempted to obtain the verification of non-filing from the relevant tax authority and was unable to obtain the required documentation.

SPECIAL CIRCUMSTANCES

Joint Returns: For tax filers who filed a 2023 joint income tax return and at the time of the FAFSA are now separated, divorced, widowed or married to someone other than the spouse included on the 2023 joint income tax return, you must collect:

A transcript obtained from the IRS or other relevant tax authority that lists 2023 tax account information; or
A copy of the income tax return and applicable schedules that were filed with the IRS or other relevant tax authority; and
A copy of the W-2 for each source of 2023 employment income received or an equivalent document.

Filing Extensions: For an individual who is required to file a 2023 IRS income tax return and has been granted a filing extension by the IRS beyond the automatic six-month extension, you must collect:

A signed statement listing the sources of any 2023 income and the amount of income from each source;
A copy of the IRS’s approval of an extension beyond the automatic six-month extension;
A copy of IRS Form W-2 for each source of 2023 employment income received or an equivalent document; and
If self-employed, the signed statement must indicate the amount of estimated AGI and U.S. income tax paid for the tax year 2023.

Please note – an individual who was called up for active duty or for qualifying National Guard duty during a war or other military operation or national emergency is permitted to submit a statement certifying that he or she has not filed an income tax return or a request for a filing extension because of that service.

Tax-Related Identity Theft: The department has made a change on the documentation requirements for individuals who are the victim of IRS tax-related identity theft. For these individuals, you must collect:

A copy of the signed 2023 income tax return and applicable schedules filed with the IRS; and
An IRS 4674C Letter (a letter from the IRS acknowledging the identity theft) OR a statement signed and dated by the tax filer indicating that he or she was the victim of IRS tax-related identity theft and that the IRS has been made aware of the tax-related identity theft.

Amended Returns: For an individual who filed an amended return with the IRS, you must collect a signed copy of the 1040X that was filed with the IRS that includes the changes made to the tax filer’s 2023 tax information, as well as one of the following:

Income and tax information from the IRS on an IRIS record with all tax information from the original return;
A transcript obtained from the IRS that lists 2023 tax account information of the tax filer(s); or
A signed copy of the 2023 IRS Form 1040 and the applicable schedules that were filed with the IRS.

In some cases, the IRS may have made changes to amend the tax return information. For these cases, a 1040X will not exist. Instead, the filer should provide a copy of the IRS letter outlining the changes that were made. They must still provide one of the items listed in the three bullets above.

Incarcerated/Confined Students: For students who are confined or incarcerated, verification of identity and the statement of educational purpose are all that is needed. This will only apply to those selected for verification groups V4 and V5. These applicants will not need to verify any other items. Nothing will be required for applicants selected for verification group V1.

If the confined/incarcerated individual is unable to submit a signed and notarized statement of educational purpose, the school may accept a signed statement from an authorized official that works for the correctional facility or authorized official that works for the oversight entity confirming to the school that the individual who completed the FAFSA is the person signing the statement of educational purpose. For identification documentation, you are permitted to accept an ID issued by the correctional facility.

Applicants Eligible Only for Unsubsidized Aid: Under certain circumstances, an applicant may be excluded from verification. 668.54(b) provides the list of exclusions. One of the exclusions pertains to applicants who are only eligible for unsubsidized aid. Per this regulation, verification would not be required for these applicants. However, the department has indicated that for applicants only eligible for unsubsidized aid who are selected for verification groups V4 or V5, the college should verify identity/statement of educational purpose. You would not need to verify any of the other items included in verification for group V5 for these applicants.

Although verification is not required for these applicants, the department believes verification of identity will help ensure that only eligible students are receiving federal student aid. For information on this issue, please see the regulation cited above as well as the verification section of the Program Integrity Information Page Q&A on IFAP – VER-Q6/A6 and DOC-Q18/A18. This is the direct link to the Q&A for verification.

Rick Cox is Global’s Executive Director of Regulatory Affairs and Compliance
Siobahn Arbogast is Director of Title IV Accounting