Maintained for Historical Purposes

This resource is being maintained for historical purposes only and is not currently applicable.

2005-2006 Federal Student Aid Handbook in PDF Format

Award Year: 2005-2006

Chapter: --Application and Verification Guide

Section: --Application and Verification Guide

Page Numbers: 1-108

Revised on 08-02-2005

The Handbook is posted each year on the Web, and a print version is later mailed to all schools participating in the Federal Student Aid programs. (See instructions for updating your school's mailing address for publications.) Once the Handbook has been mailed, additional copies may be ordered online from the Department; see Publications for Financial Aid Professionals. Questions about and suggestions for the Handbook can be sent to the Research and Publications Group in the Schools Channel.

Each chapter of the Application and Verification Guide section of the 2005-2006 FSA Handbook is presented as a separate PDF File. Look right to see all the chapters (listed as attachments) and the hyperlink text.

Award Year: 2005-2006

Chapter: --Volume 1 - FSA Handbook: Student Eligibility

Section: --Volume 1 - Student Eligibility

Page Numbers: 1-76

Revised on 08-02-2005

Each Chapter of Volume 1 - Student Eligibility of the 2005-2006 FSA Handbook is presented as separate PDF file. Look right to see all the Chapters (listed as attachments) and the hyperlink text. Requires 4.0 or greater of the free Adobe Acrobat Reader software.

Award Year: 2005-2006

Chapter: --Volume 2 - FSA Handbook: School Eligibility and Operations

Section: --Volume 2 - School Eligibility and Operations

Page Numbers: 1-240

Revised on 08-11-2005

Each Chapter of Volume 2 - School Eligibility and Operations of 2005-2006 FSA Handbook is presented as a separate PDF File. Look right to see all the chapters (listed as attachments) and the hyperlink text. Requires 4.0 or greater of the free Adobe Acrobat Reader software.

Award Year: 2005-2006

Chapter: --Volume 3 - FSA Handbook: Calculating Awards & Packaging

Section: --Volume 3 - Calculating Awards & Packaging

Page Numbers:

Posted on 09-21-2005

Each Chapter of Volume 3 - Calculating Awards & Packaging of 2005-2006 FSA Handbook is presented as a separate PDF File. Look right to see all the chapters (listed as attachments) and the hyperlink text. Requires 4.0 or greater of the free Adobe Acrobat Reader software.

Award Year: 2005-2006

Chapter: --Volume 4 - FSA Handbook - Processing Aid & Managing FSA Funds

Section: --Volume 4 - Processing Aid & Managing FSA Funds

Page Numbers: 1-44

Posted on 06-27-2005

Each Chapter of Volume 4 - Processing Aid & Managing FSA Funds of the 2005-2006 FSA Handbook is presented as a separate PDF File. Look right to see all the chapters (listed as attachments) and the hyperlink text. Requires 4.0 or greater of the free Adobe Acrobat Reader software.

Award Year: 2005-2006

Chapter: --Volume 5 - FSA Handbook: Overawards, Overpayments, & Withdrawal Calculations

Section: --Volume 5 - Overawards, Overpayments, & Withdrawal Calculations

Page Numbers: 1-158

Posted on 05-19-2005

Each Chapter of Volume 5 - Overawards, Overpayments, & Withdrawal Calculations of 2005-2006 FSA Handbook is presented as a separate PDF File. Look right to see all the chapters (listed as attachments) and the hyperlink text. Requires 4.0 or greater of the free Adobe Acrobat Reader software.

Award Year: 2005-2006

Chapter: --Volume 6 - FSA Handbook: Campus-Based Programs

Section: --Volume 6 - Campus-Based Programs

Page Numbers: 1-132

Posted on 07-06-2005

Each Chapter of Volume 6 - Campus-Based Programs of the 2005-2006 FSA Handbook is presented as a separate Portable Document Format (PDF) File. Look right to see all the chapters (listed as attachments) and the hyperlink text. Requires 4.0 or greater of the free Adobe Acrobat Reader software.

Award Year: 2005-2006

Chapter: --2005-2006 FSA Handbook Errata and Updates

Section: --2005-2006 FSA Handbook Errata and Updates

Updated on 11-08-2005

Unless otherwise indicated, the errata and updates below are items that were amended after the initial PDF files were posted to the Web and before the Handbook went to print.

For questions about the Handbook contents, you can contact the Schools Publications staff at: fsaschoolspubs@ed.gov.

Application and Verification Guide

Description

Location

We updated the margin note to show that the deadline date notice for the 2004-2005 award year was published on April 13, 2005.

P. AVG-7

The instruction for the veteran status match was corrected to read that for match flags 2 and 3 the CPS will now assume the answer to the veteran question on the application is "yes."

P. AVG-27

In the upper half of the table, in the parent row and IRS form column, the text was corrected to read that the tax return must be signed by the parent, not the student.

P. AVG-33

Volume 1: Student Eligibility

Description

Location

We added a sentence to the end of the second paragraph under "Remedial coursework."

P. 1-2

We updated some contact information for the CELSA and Wonderlic ATB tests.

P. 1-7

Volume 2: School Eligibility and Operations

Description

Location

The following correction was not made to the print edition of the Handbook, and also is not reflected in the PDF files for Volume 2.

In the sidebar Counseling materials for overseas or correspondence students, delete the words "at that school."

P. 2-102

Volume 3: Calculating Awards & Packaging

Description

Location

There are a couple of numerical changes to the example at the bottom of the page on GI Bill exclusion packaging.

  • change 250 FWS on left side of example to 1000

  • change 250 FSEOG on left side of example to 500

  • change total aid on left side of example to 15,725

  • 3rd paragraph of text of example, 6th line: change "...$500 less than her need" to "$1500 less than her need."

  • 3rd paragraph of text, 7th line: change "...up to $500--for example $250 in FWS funds an $250 in FSEOG funds" to "...up to $1500--for example, $1,000 in FWS funds and $500 in FSEOG funds."

  • 3rd paragraph of text, last line: Change "Penny's assistance totals $14,725..." to "Penny's assistance totals $15,725..."

P. 3-107 of Vol. 3 of the 05-06 up on IFAP

Chapter 1: Added discussion on payment periods for students who withdraw and then transfer or reenter a credit-hour nonterm program or a program that measures progress in clock hours

p. 3-13

Chapter 1: Added discussion on payment periods and the credit hour/clock hour conversion formula

p. 3-13

Chapter 2: Updated costs waived or paid by other sources section

p. 3-20

Chapter 3: Updated enrollment status for students taking regular and correspondence courses guidance

p. 3-28

Retaking Coursework guidance updated

p. 3-41

Chapter 3: Initial Calculation sidebar added

p. 3-44

Chapter 5: Expanded the crossover payment period discussion for greater precision

p. 3-96

Volume 6: Campus-Based Programs

Description

Location

There is some some extraneous language that should not be there. Under the heading "medical technician," the following phrase should be ignored "The Department of Defense maintains an updated listing of hostile fire/imminent danger pay areas at the following URL:"

P. 6-96

Award Year: 2005-2006

Chapter: --What's New in the 2005-2006 Handbook

Section: --What's New in the 2005-2006 Handbook

Posted on 08-19-2005

This page lists the items that changed from last year's edition of the FSA Handbook. For questions about the Handbook contents, contact the Schools Publications staff at: fsaschoolspubs@ed.gov.

For information about ordering the Handbook, please see the Publications and How to Order Web page.

Application and Verification Guide
Chapter 1 The Application Process

Description

Location

Some schools have required students to fill out supplemental forms (in addition to the FAFSA) in order to apply for federal student aid. This is not permitted, and we have added text to that effect.

P. AVG-3

We inserted the caution that students should not give their PIN to anyone, nor should anyone ask for it, even if they plan to assist the student with receiving aid. A Dear Colleague Letter (GEN-04-10, September 2004) explains this further.

P. AVG-4

The margin note was changed to discuss the limited circumstances for which one can receive a paper renewal FAFSA; most returning students will now receive a renewal reminder rather than a paper renewal FAFSA.

P. AVG-5

Chapter 2 Filling Out the Application

Description

Location

We added a margin note stating that same-sex unions do not count as marriages on the FAFSA.

P. AVG-10

We added a margin note describing how to determine the income earned from work when values on lines 12 or 18 of the 1040 form are negative.

P. AVG-12

We noted that when a parent receives untaxed Social Security benefits on behalf of a child who is a student, the benefits would be reported on the parent's side of Worksheet A.

P. AVG-15

We added a margin note on the treatment of combat pay on the FAFSA.

P. AVG-16

We added guidance under "Question 50" stating that a student who is independent due only to marriage becomes dependent for the next award year when divorced.

P. AVG-23

We clarified guidance regarding financial support for children of students. Such support from anyone other than the student's parents may be counted as support provided by the student for determining whether the child is a dependent of the student and whether the child should be counted in his household size.

P. AVG-26

We removed the veteran match charts in Chapter 2 that reproduce information from the ISIR Guide because they were redundant with the text on p. 27. We added the pertinent page references for the ISIR Guide.

P. AVG-27

We clarified the instruction at the top of the page to state explicitly that FAAs cannot accept a faxed or copied signature for the application.

P. AVG-34

Chapter 3 Expected Family Contribution

Description

Location

Because schools can no longer pay on the secondary EFC under any circumstance, we emended the language on the top of the page to show that, rather than use the secondary EFC, schools must correct and re-submit an application for which the student wrongfully met the simplified needs test.

P. AVG-36

Chapter 5 Corrections, Updates, and Adjustments

Description

Location

We added a margin note to allay worries about the size of IRS Publication 17. While it is a long document, we have specified the page numbers to which you might need to refer when resolving cases of conflicting information.

p. AVG-102

Volume 1: Student Eligibility

Throughout this volume we removed the charts of match flags and results that were reproduced from the ISIR Guide. We did this for a couple reasons: we could not replicate the charts in full here, and they were often redundant with material already presented in the body of the text.

Chapter 1 School-Determined Requirements

Description

Location

We inserted a margin note about contacting the pertinent state department of education to determine what is a valid high school diploma.

P. 1-3

We added a new Ability-to-Benefit test: the WorkKeys Program assessments by American College Testing (ACT).

P. 1-7

Chapter 2 Citizenship

Description

Location

We corrected a statement regarding USCIS procedures. Conditional permanent residents receive an I-551 form that is valid for two years. The text had stated that they must file a petition with the USCIS to remove their conditional status in the 90 days following the expiration of their I-551, but it actually must be done in the 90 days prior to the end of the two years.

P. 1-23

We removed the summary chart of documentation because the material in the chart should be read in full in the body of the chapter.

P. 1-34

Chapter 3 Financial Aid History

Description

Location

At the end of the second paragraph on the total and permanent disability cancellation, we noted that a defaulted loan that is conditionally discharged remains in default until it is permanently discharged at the end of the three-year conditional period.

P. 1-43

We added a margin note explaining the meaning of "substantial gainful activity."

P. 1-43

Chapter 4 Social Security Administration

Description

Location

We added an explanation of the new Master Death File check by the CPS.

P. 1-50

Chapter 6 Program-related Eligibility Requirements

Description

Location

We added a margin note stating that aid administrators may not perform a credit check on students as a condition for awarding them federal student aid.

P. 1-62

We inserted new sections on the Leveraging Educational Assistance Partnership (LEAP) Program and the Robert C. Byrd Honors Scholarship Program.

Pp. 1-67-70

Volume 2: School Eligibility and Operations
Chapter 9 Record Keeping and Disclosure

Description

Location

We have added a discussion: What constitutes written consent (to disclose personally identifiable information).

P. 2-158

Chapter 10 Administrative Capability

Description

Location

Chart of System Configurations has been updated.

P. 2-167

Volume 4: Disbursing & Managing FSA Funds
Chapter 1 MPN & Stafford/PLUS Loan Process

Description

Location

Discussion of PLUS MPN -- some minor deletions to eliminate information covered elsewhere.

P. 4-6

Sidebar on COD -- revised to reflect full participation by all schools in 05-06.

P. 4-7

Boxed text on Additional Unsubsidized Stafford: adds a condition that does NOT make a dependent student eligible for additional Stafford funds (school's decision not to participate in PLUS) and a condition that DOES make the student eligible (parent documents that condition of bankruptcy filing prevents any additional borrowing).

P. 4-9

Chart revised for clarity.

P. 4-12

Chapter 2 Disbursing FSA Funds

Description

Location

Titles of second and third sidebar notes -- revised for clarity.

P. 4-14

Sidebar note on Loan Disbursements -- revised for clarity. Also, a substantially revised and expanded discussion of "Retaking Coursework" has been added, beginning on this page. (The "Retaking Coursework" discussion did not appear in the 04-05 FSA Handbook, but was previously a part of the Pell Volume of the 03-04 FSA Handbook.)

P. 4-28

Late Disbursements -- this discussion has been substantially revised for clarity and to remove dated historical references.

P. 4-30

Late Disbursement Requests -- procedures have been revised based on the most recent Dear Partner letter.

P. 4-32

Holding FFEL Stafford Loans for Verification -- this has been corrected by removing the reference to interim disbursements. A school may NOT make interim disbursements of DL/FFEL funds while waiting for verification to be completed.

P. 4-35

Chapter 3 Requesting and Managing FSA Funds

Description

Location

Sidebar note on Advance Requests for Perkins Funds -- revised to give more specific guidance on comparing available Perkins funds against anticipated disbursements.

P. 4-38

Reimbursement/Cash Monitoring -- these discussions have been revised and set apart from the main discussion, as they affect relatively few schools.

P. 4-39 and 4-50

Deleted "Maintaining FSA funds in a separate account" because the information is already presented in previous discussions.

P. 4-41

Deleted "Timely return of funds when a school does not maintain a separate federal bank account" because this topic is covered in Volume 5.

P. 4-42

Allowable Excess Cash Tolerances -- deleted as unnecessary the example that formerly appeared in the third paragraph.

P. 4-44

Volume 5: Overawards, Overpayments, and Withdrawal Calculations
Chapter 1 Overawards and Overpayments

Description

Location

Treatment of overpayments created by inadvertent overborrowing has been clarified.

P. 5-7

Chapter 2 Withdrawals and the Return of Title IV Funds

Description

Location

We have added two topics under Funds to include in a Return Calculation: GEAR UP program funds and Student Support Services grants to students.

P. 5-38 and 5-39

Percentage of Title IV aid earned for withdrawal from a credit hour nonterm program: We describe how, if a student withdraws from a self-paced non-term credit hour program before earning any credits, the institution must have a reasonable procedure for projecting the completion date of the period.

P. 5-68-70

Volume 6: Campus-Based Programs

General: Addition of chapter highlights boxes at the beginning of each chapter for easy reference to important topics.

Chapter 1 Participation, Fiscal Procedures, and Records

Description

Location

Amended promissory note guidance to reflect ability of schools to notify the borrower in writing in lieu of sending the original promissory note when loan is paid off.

P. 6-18

Added guidance on carrying out Perkins Loan liquidation.

P. 6-24

Chapter 3 Making Perkins Loans

Has been updated throughout to reflect the fact that schools are now required to exclusively use the Perkins Master Promissory Note when awarding Perkins Loans.

Chapter 4 Perkins Repayment, Forbearance, Deferment, and Cancellation

Description

Location

Updated guidance on military service cancellations, clarifying the requirements of months and years of military service for Perkins Loan cancellation.

P. 6-93

Chapter 5 Perkins Billing, Collection, and Default

Description

Location

Clarified acceptable Perkins Loan rehabilitation parameters.

P. 6-115