Special Tax Situations
■ Filing extensions. For students and parents granted a tax filing extension, a copy of IRS Form 4868, Application for Automatic Extension of Time to File U.S. Individual Income Tax Return will be accepted. Students and parents must also provide a copy of all their W-2 forms or, if self-employed, a signed statement with the amount of their AGI and their U.S. income taxes paid.
■ Filers of joint returns who are no longer married. When dependent students’ parents filed a joint return and have separated, divorced, married someone else, or been widowed, the students must submit an IRS tax transcript and a copy of each W-2 form for the parent whose tax information is on the FAFSA. Similarly, an independent student must submit a tax transcript and a copy of each of the W-2 forms if he/she filed a joint return and is separated, divorced, or a widow.
■ Non-tax filers must submit a W-2 form for each source of employment income. They must also submit a signed statement giving the sources and amounts of the person’s income earned from work not on W-2s, and TAMUT will certify that the person has not filed and is not required to file a tax return. For residents of the Freely Associated States (the Republic of the Marshall Islands, the Republic of Palau, or the Federated States of Micronesia), a copy of the wage and tax statement from each employer and a signed statement identifying all of the person’s income and taxes for the year is acceptable. Persons from a U.S. territory or commonwealth or a foreign country who are not required to file a tax return can provide the signed statement certifying their income and taxes paid. Financial aid professionals are not expected to have special knowledge or expertise regarding the U.S. tax code. If someone whose data are required on the FAFSA submits a signed statement claiming non-filer status and TAMUIT has reason to believe that person would have been required to file a U.S. tax return, the student is required to submit a “Verification of Nonfiling Letter” from the IRS that she did not file a 2014 IRS income tax return. Students can obtain this by using the “Get Transcript Online” tool at www.irs.gov/Individuals/Get-Transcript or by submitting IRS Form 4506-T and checking box 7. Note that verification of nonfiling is not an indication that the person is not required to file a return, just that he/she did not file one. Also, the IRS will generally not issue a Verification of Nonfiling Letter for the previous tax year until after June 15. However, because there are limited circumstances when they will provide the letter before that date, for purposes of verification, a letter for the prior year must be dated on or after June 15.
■ For filers of non-IRS tax returns, Texas A&M University-Texarkana will accept a transcript obtained from a government of a U.S. territory or commonwealth or a foreign nation that includes all of the tax filer’s income and tax information required to be verified for the relevant tax year 2014. If a transcript is not available, you may accept instead a copy of the tax return, which must be signed by the filer or one of the filers of a joint return. Use the income and tax information that most closely corresponds to the information on the IRS tax return, and convert monetary amounts into U.S. dollars as appropriate.
■ Filers of amended returns. Students or parents who file an amended return (IRS Form 1040X) cannot use the IRS DRT, and if they amend the return after using the DRT to fill out the FAFSA, Texas A&M University-Texarkana cannot rely on that data. Instead, the university will need to use information from these documents to complete verification: 1. a signed copy of the 1040X form that was filed and 2. a tax return transcript (which does not have to be signed), or any IRS transcript (such as a return transcript for taxpayer or RTFTP) that includes all the income and tax information required to be verified: AGI, income tax paid, education credits, etc.
■ Victims of identity theft who cannot get a return transcript or use the DRT must call the IRS’s Identity Protection Specialized Unit (IPSU) toll-free number at 800-908-4490. After the IPSU authenticates the tax filer’s identity, he/she can ask the IRS to mail him/her an alternate paper tax return transcript known as the TRDBV (Transcript DataBase View) that will look different than a regular transcript but that is official and can be used for verification. Unless the university doubts the TRDBV’s authenticity, you don’t need to get an IRS signature or stamp or any other validation. See DCL GEN-14-05 for a sample TRDBV.
■ Using a tax return to complete verification. When the DRT and return transcript are not available and you must use a tax return for verification, it will likely have been filed electronically with one of a variety of methods. These include do-it-yourself methods as well as completion by a tax preparer. Each method should permit printing of a paper copy of the return, though the e-file format might not contain every line item, showing instead only the data the tax filer provided. For example, if Item 8a, “Taxable interest income,” does not appear on such a return, that means no taxable interest income was reported. Texas A&M University-Texarkana will also accept an electronic copy of the return that has been electronically signed. However, a signature on Form 8879, the IRS e-file Signature Authorization, is not an acceptable substitute for a signature on the tax return. For persons who have a tax professional prepare their return, instead of a copy of the return with the filer’s signature, the university will accept one that has the name and Preparer Tax Identification Number (PTIN) of the preparer or has his SSN or EIN and has been signed, stamped, typed, or printed with his name and address. Note that the IRS requires paid preparers to have a PTIN.