What is the FAFSA IRS Data Retrieval Tool?
We recently took a look at IDOC, a system College Board uses to collect tax information from families that have submitted the CSS Profile. Now, let’s dig into the tool the federal government uses to collect similar tax info through the FAFSA.
This is known as the IRS Data Retrieval Tool.
As its name would suggest, the tool syncs with the IRS to allow students and parents to access their tax return information which is needed to complete the FAFSA.
Before the IRS Data Retrieval Tool, families would have to submit their tax information other ways, including faxing (what?) or dropping off/mailing in hard copies to financial aid offices. At other times, there was a need to access a copy of the tax return transcript through the IRS directly. This wasn’t usually a fun experience.
So the FAFSA introduced the IRS Data Retrieval Tool to make the process of submitting tax information easier, and it largely worked. While it’s not currently an option for all families, based on tax filing status, most can use the tool.
One common misconception is that families will be able to use the tool immediately, or soon after, submitting their taxes electronically. That’s not the case. Instead, families will need to wait roughly three weeks to be able to use the IRS Data Retrieval Tool. In the meantime, families will be able to manually update their tax information via the FAFSA.
When you complete your taxes and the three weeks have passed, you can log back into the FAFSA to make corrections. The selection of ‘Will File’ will be changed to indicate the taxes have been completed. At that time you will have the option to proceed with the IRS Data Retrieval Tool, assuming you’re eligible to use it. A few questions are asked, you will be taken to the IRS website and you will be able to transfer your tax information directly to the FAFSA.
That’s the IRS Data Retrieval Tool. Not necessarily a fun process, but in most cases more convenient than before.