The Department of Education (DOE) released the newest IRS Tax Return Matrix for the 2023-2024 FAFSA Award Year. The full publication of this announcement can be found on FSA Partner’s Connect here.
What is the Tax Return Matrix?
This Tax Matrix can be used to assist schools when verifying tax data on a student’s ISIR (skip to definitions to learn what an ISIR is). Because the IRS Tax Return Transcript doesn’t have line or item numbers AND uses different terminology than the FAFSA, matching tax data to a student’s ISIR can become confusing quickly. That is where this matrix comes in!
How to read the Tax Return Matrix
The Matrix consists of 5 columns in an easy-to-read format directly correlating to Verification. Verification has two flags that require review of income, the V1 and a V5 flag.
- The first column of the Matrix lists what tax information is required to be reviewed for Verification
- The second column lists the FAFSA question number for each required item in column one for both the student and parent sections of the application
- The third column displays the ISIR field number
- The fourth column displays the language used on the actual Tax Return Transcript for each item
- Lastly the fifth column displays the correlating fields of each item on a 1040
When completing Verification review of income, this Matrix comes in handy because it shows which ISIR field to match against which field of the Tax Return Transcript OR the 1040. In addition, when reviewing this information with a student or parent, the Matrix can tell you which FAFSA question you’re referencing for Verification review.
Download the Tax Return Matrix Here
Definitions
Higher Education is no stranger to acronyms! Wondering what an ISIR is? Read more about it below!
What is the FAFSA?
FAFSA stands for Free Application for Federal Student Aid. Students complete this application every year to apply for federal grants, work-study, and loans.
What is an ISIR?
ISIR stands for Institutional Student Information Record. This is an electronic federal output document produced by the Department of Education’s Central Processing System (CPS) after a student completes the FAFSA.
What is an IRS Tax Return Transcript?
A tax return transcript can be ordered from the IRS and shows line items from your original 1040 tax return along with any forms and schedules. It will not show changes made after the original return is filed with the IRS. Read more about the different IRS Transcript types here.
What is Verification?
Verification is the process of confirming that the information reported on the FAFSA is accurate. The Department of Education may select students at random for Verification review as can a school.
Always Here to Help!
At Financial Aid Services, we are no stranger to confusing regulations! We’re here to help translate the lingo and give you the info you need to process students in an efficient manner. Have a question about a recently published DOE article? Don’t hesitate to reach out!