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(Application Processing) Subject: Early FAFSA Electronic Announcement #1 - President's Announcement of FAFSA Filing Changes

Posted Date:September 14, 2015

Author: Jeff Baker, Director, Policy Liaison and Implementation, Federal Student Aid

Subject: Early FAFSA Electronic Announcement #1 - President's Announcement of FAFSA Filing Changes

Today, September 14, 2015, President Obama announced two major changes to the Free Application for Federal Student Aid (FAFSA) process. First, the President announced a change to the date when students and families can begin to submit a FAFSA. Currently the FAFSA is available on January 1st for the upcoming financial aid award year (July 1 through June 30). For example, the 2016-2017 FAFSA will be available on January 1, 2016. Beginning with the 2017-2018 financial aid application cycle, the FAFSA will be available on October 1st of the year prior to the upcoming award year. Thus, 2017-2018 FAFSA filing will begin on October 1, 2016. By having the FAFSA available earlier the financial aid process will generally coincide with the college admissions application and decision cycle, hopefully allowing schools and states to provide financial aid information sooner to students and families.

Second, the President announced a change to which tax year’s information will be collected on the FAFSA. Currently, when completing a FAFSA applicants provide income information from the prior tax year (e.g., 2015 income information for the upcoming 2016-2017 FAFSA). Beginning with the 2017-2018, FAFSA income information from one tax year earlier – the so-called “prior-prior year” will be collected. This means that the 2017-2018 FAFSA will collect tax year 2015 income information and not 2016 information. As a result of this change most students will be able to complete their FAFSAs using information from an already completed tax return. This in turn, will provide most of them with the ability to electronically transfer their income tax return information from the IRS into the FAFSA using the IRS Data Retrieval Tool (DRT). This is in contrast with the current “prior year” process where many applicants submit their FAFSAs before tax returns have been completed resulting in the need to estimate income and tax information that subsequently needs to be corrected once the tax return is filed; or worse, waiting to complete their FAFSA until after the tax return has been filed.

After consultation with, and support of, the financial aid community (including financial aid administrators, state grant agencies, and college access organizations) we appreciate that there are a number of issues (both large and small) that will need to be resolved over the next months. Among those is the impact this change may have on requests from students and families to institutions for consideration of professional judgment determinations when there have been significant financial changes from the “prior-prior year”. Over the next weeks we will be providing more information regarding the use of professional judgment, especially as it relates to the transition to “prior-prior year” data beginning in 2017-2018. We also will be sharing our thoughts with, and soliciting input from financial aid administrators, on this and other issues at our Federal Student Aid Training Conference in December in Las Vegas.

We are very excited about the FAFSA changes the President announced today and look forward to working with institutions, state grant agencies, high school and other counselors, and the many organizations that work to ensure that every eligible student has the opportunity to be considered for all financial aid for which they may be entitled.

On behalf of Secretary Duncan, we thank you for your continued support.

Last Modified: 09/13/2015