The Free Application for Federal Student Aid recently implemented an online tool that allows students to upload their parents’ and their own income tax information directly from IRS records.
The IRS Data Retrieval Tool, a joint venture between FAFSA and the IRS, will replace the process of producing paper records of tax returns to verify family income levels. According to UCSB Financial Aid Director Mike Miller, the new method eliminates the possibility of falsifying tax records and the hassle of contacting the IRS to obtain the documents.
Miller said this new tool is a huge step forward for the FAFSA application process, and he intends to make the tool known to all UCSB students.
“We really want students to use the IRS Data Retrieval Tool so that they don’t have to experience the delay and additional stress of having to contact the IRS and get a tax transcript,” Miller said. “This is, I think, the most secure and accurate way for students to apply for financial aid; we’re definitely hoping that students will take advantage of it.”
According to Miller, the streamlined online method significantly cuts down on the margin of error in applications.
“FAFSA has been criticized over the years because some families find [the applications] confusing; it has always been seen as kind of an obstacle for families,” Miller said. “The IRS Data Retrieval Tool simplifies the process and the element of human error is essentially eliminated — it is a good thing.”
The IRS is also encouraging those making $49,000 a year or less to take advantage of earned income tax credits. IRS Media Relations Specialist Anabel Marquez said many miss out on these benefits because they fail to claim the credit on their taxes.
“Our research has shown that one out of every five individuals fails to claim [earned income tax credits], and if people are aware, they may be able to have some extra cash in their pockets,” Marquez said.
According to California law, any person making less than $950 annually does not have to file taxes; however, Marquez stressed the importance of doing so regardless due to the potential benefits.
“This benefit can increase a person’s refund by up to $5,700,” Marquez said. “This is something that can really help as a financial boost for people working hard to make ends meet.”
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