Applicants who file the Free Application for Federal Student Aid (FAFSA) and who indicate that they or their parents will not file a federal income tax return may be required to obtain a Verification of Nonfiling Letter from the IRS if their FAFSA is selected for verification.
Colleges may also require the applicant to provide a Verification of Nonfiling Letter if the applicant’s income or the parent’s income falls below the IRS filing thresholds. The IRS filing thresholds can be found in Table 1-1 and Table 1-2 in IRS Publication 17.
The requirement to obtain a Verification of Nonfiling Letter is part of a process called Verification in which the applicant is required to supply backup documentation for some of the data elements on the FAFSA.
What is a Verification of Nonfiling Letter
A verification of nonfiling letter confirms that the IRS has not received a tax return for the student or parent, as applicable. It does not state whether the student or parent was required to file a federal income tax return.
If the student’s income or the parent’s income exceeds the IRS filing thresholds, but they did not file a federal income tax return, the college financial aid administrator will consider this to be conflicting information that must be resolved before aid can be disbursed.
How to get a Verification of Nonfiling Letter
It can take several weeks to get a Verification of Nonfiling Letter. Applicants may wish to order a Verification of Nonfiling Letter soon after they file the FAFSA to ensure that they have it available if the college financial aid office asks for it.
A Verification of Nonfiling Letter can be obtained using the IRS Get Transcript Tool or by filing IRS Form 4506-T. Low-income families are unlikely to satisfy the security requirements to use the online Get Transcript tool. Instead, they will need to use line 7 of IRS Form 4506-T to request a Verification of Nonfiling Letter.
Verification of Nonfiling Letter must be unambiguous
The IRS response to the request for a Verification of Nonfiling Letter must be unambiguous. A response that states “no transcript on file” or “no record of return filed” is sufficient verification of nonfiling. A response that states “could not be processed” or “request could not be honored” is not sufficient.
In some cases the student will receive IRS Form 13873 from the IRS instead of a Verification of Nonfiling Letter. If this form clearly states that the form is provided as verification of nonfiling or that the IRS has no record of a tax return, it is sufficient proof of nonfiling.