This week, President Obama announced that beginning with 2017-2018, FAFSA income information from one tax year earlier – the “prior-prior year” (PPY) – will be collected. This means that the 2017-2018 FAFSA will collect tax year 2015 income information and not 2016 information.
According to IFAP’s Announcement of FAFSA Filing Changes, “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”.
Of course, this change has schools wondering how to manage the transition to PPY. And, many are concerned about the increased burden on financial aid departments. We get it. We’ve been working with colleges and universities across the country to improve financial aid processing through cloud-based, self-service financial aid software. We’ve compiled three tips to help as you start preparing for this transition.
1. Scale financial aid processes with automation and student self-service.
The goal of PPY is to make it easier for students and families to fill out the FAFSA, since families will be able to use completed tax information. With simplicity comes higher volume. But, many schools are managing financial aid with primarily paper-processes that don’t scale. The lack of student self-service and mobile technology coupled with complex financial aid processes, makes financial aid time-consuming for both staff and students.
You don’t need to hire more people to handle higher volume. You need automation. Look for a cloud-based, solution designed to automate all activities for professional judgements, c codes, verification, SAP appeals, and other custom forms like Budget Worksheets, Low Income Verification Forms, and Federal Work Study Forms. You’ll accelerate financial aid processing and give students what they want – a mobile, online experience to manage tasks, upload documents, and finish documentation fast.
2. Simplify professional judgement management.
One of the expected impacts of PPY is an increase in 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”. So many things can affect a student’s financial status in two-years — a layoff or an economic downturn can cause significant and sudden changes in a family’s need for aid that would be missed if the aid application only looks at two-year-old financial circumstances.
Because the professional judgement process is document intensive, automation can dramatically simplify collection and management of PJ documents. Look for a solution that allows you and your students to manage professional judgments online and with mobile devices. Simplify the process with automatic follow-up on professional judgment documentation and trigger confirmations via email and SMS texts. Even better, eliminate time consuming imaging and indexing of documents for storage with pre-indexed document retrieval.
3. Turn around award year updates faster.
We recognize that transitioning to PPY is going to bring its fair share of headaches. Eliminate one of those headaches by reducing the time it takes to update systems for a new award year. Come Oct 2016, don’t worry about upgrading, reconfiguring, and retesting your ability to process student applications. Look for a cloud-based solution provider that supports award year updates out-of-the-box without placing additional work on your staff.
To further reduce the stress of this pending transition, consider moving to a Financial Aid Self-Service Platform now rather than waiting until the award year transition. Cloud-based software-as-a-service (SaaS) solutions offer rapid implementation with minimal IT support and a shorter time to value than traditional software because there is no hardware or software to purchase and implement.
As you’re planning this transition, we’re here to help. Contact us for a free demo of our software to learn how technology can automate and simplify your transition to PPY.