(GENERAL-24-149) Guidance on Consent for FAFSA Data Sharing and Automatic IDR Certification

This announcement provides general guidance to institutions of higher education (institutions) on obtaining written consent prior to sharing data from the FAFSA^® (Free Application for Federal Student Aid) with certain third parties under the requirements of the Higher Education Act of 1965, as amended (HEA), and the Family Educational Rights and Privacy Act (FERPA), including considerations for institutions to embed such consent into their regular practices. This announcement also provides information on how institutions can remind students of the importance of providing affirmative consent to the U.S. Department of Education (Department) to share their Federal Tax Information (FTI) for purposes of auto enrollment in and recertification of income driven repayment (IDR) programs.

The Department recognizes the importance of institutions collecting written consent from students for the further redisclosure of FAFSA data (but not FTI) to other eligible entities. To assist institutions in this effort, this announcement outlines guidance on what information they must include in such consent along with how to adequately collect such consent. Under FERPA, prior written consent from students who are or have been in attendance at an institution is required in situations where there is no applicable exception to FERPA’s general consent requirement for a particular disclosure or redisclosure of FAFSA data maintained by the institution. Additionally, Section 494 of the Higher Education Act (HEA) requires written consent for purposes of further redisclosure and discussion of FAFSA data by the institutions and additional data restrictions for entities that receive the information. See GENERAL-24-129 for more information on these consent requirements and the applicability of both laws and the Student Privacy Policy Office for more information about FERPA.

As explained in our previous announcements on means-tested benefit outreach (GENERAL-24-93 Guidance on Means-Tested Benefits Outreach for Institutions and State Grant Agencies), institutions can use limited FAFSA data (but not FTI) to target students with outreach about means-tested benefits for which they may be eligible. For a detailed description of what constitutes FAFSA data, see GENERAL-24-129 for definitions of FAFSA data. Additionally, with a student’s prior written consent, an institution can also share the student’s FAFSA data with agencies that administer certain means-tested benefits programs, such as the Supplemental Nutrition Assistance Program (SNAP), to assist the students in accessing benefits.

The Department offers the following template that IHEs can consider as they develop consent language for purposes of redisclosing student FAFSA data for the aforementioned purposes. This consent must be signed and dated (electronic signatures are permitted). (Note: This language is a sample template provided for reference only; IHEs are responsible for consulting with legal counsel to ensure that any consent language the institution develops and uses meets all applicable law):

Disclosure of Information Protected by the Family Educational Rights and Privacy Act and the Higher Education Act (HEA) by [Name of School] to [Name of Appropriate Authority]

In compliance with the HEA (including but not limited to Sections 483 and 494) and pursuant to the Family Educational Rights and Privacy Act (FERPA) (20 U.S.C. § 1232g; 34 C.F.R. part 99), the written consent of a parent or eligible student is required before the education records of a student, or personally identifiable information contained therein, may be disclosed to a third party, unless an exception to this general requirement of written consent applies. If a student is age 18 years or older, or is enrolled in an institution of postsecondary education, he or she is an “eligible student” and must provide written consent for the disclosure of his or her education records or personally identifiable information contained therein.

I [Insert Student Name], hereby agree to allow [Insert School Name] to disclose [Specify the Personally Identifiable Information from Education Records or Education Records That May be Disclosed (For, e.g., information obtained from my Free Application for Federal Financial Aid (FAFSA)] to [Identity the Party or Class of Parties to Whom the Disclosure May be Made (For, e.g., to state benefits agencies that administer means-tested benefits)] for [State The Purpose of The Disclosure (For, e.g., the purpose of communicating with me about and determining my eligibility for means-tested benefits programs that can help pay for my cost of attendance)].

You may withdraw your written consent to disclose this information at any time. A request to withdraw your consent should be submitted to [Insert to Appropriate Individual or Entity] in writing and signed.

Institutions can also consider a variety of opportunities for collecting written consent from their students. These methods should provide the conditions for informed consent and be accessible for students to visit when needed. Examples of embedding such written consent opportunities include, but are not limited to:

Income-driven repayment (IDR) plans can help students manage their student loan debt by reducing their monthly payment amounts and providing IDR and Public Servicer Loan Forgiveness credit. For some borrowers, payments can be as low as $0. Borrowers need to provide proof of income to enroll in an IDR plan and again to recertify their income each year. When submitting an application for IDR through their studentaid.gov account, borrowers of Direct Loans are given the option to provide authorization to the Department to obtain their FTI from the Internal Revenue Service (IRS) for purposes of calculating payments for IDR plans and recertifying plans annually. Borrowers with consent on file with the Department will also be auto-enrolled in IDR if delinquent on their student loans for more than 75 days. This consent is ongoing until a borrower pays off their loan, withdraws from IDR, or revokes their consent. If a student does not provide this consent, they will have to provide their income information manually. Note that this authorization is separate and distinct from the authorization collected on the FAFSA for the Department to obtain an applicant’s information from the IRS and redisclose to institutions and state grant agencies for determining financial aid eligibility. This consent applies to authorization provided to the Department by the borrower for IDR certification. Under the Internal Revenue Code (IRC), institutions are not permitted to obtain written consent for the use and disclosure of income information from the IRS for purposes of administering the IDR program and repayment certifications.

While providing consent to the Department to obtain their FTI for IDR enrollment and recertification is not required for borrowers, institutions should consider providing information about this option to students to inform them of ways to ease student loan repayment. Institutions cannot collect this consent on behalf of the Department, but they can incorporate information about this consent into existing touchpoints institutions have with students about paying for college.

Examples of touchpoints where institutions can remind students of FTI consent include:

The following is sample language an institution can consider including in their disclosures to students about student loans:

The U.S. Department of Education offers income-driven repayment (IDR) plans for federal student loans. IDR plans are designed to make your student loan debt more manageable by reducing monthly payment amounts and providing credit for IDR and for Public Service Loan Forgiveness (PSLF). You will need to certify your income and family size each year you want to use an IDR plan. You can provide authorization to the U.S. Department of Education to retrieve your Federal Tax Information directly from the Internal Revenue Service (IRS) rather than manually entering your information each year. This authorization would allow your income to be automatically certified annually so you can remain eligible for the plan and to allow you to be automatically enrolled in an income-driven payment plan if you fall behind on your student loan payments. Consent must be provided by logging into your StudentAid.Gov account. More information can be found here: https://studentaid.gov/idr/application/demo/consent.