Changes in Federal Law Affecting Financial Aid for 2012-13

On This Page

› IRS Data Retrieval and IRS Tax Transcript (personal copies of tax returns no longer accepted)
› Pell Grant Lifetime Limit.

› Changes to Federal Direct Student and Parent Loans.

› Satisfactory Academic Progress - one appeal; one probationary semester.

Due to changes in federal law, there are several changes in the application process.
Here is a summary of some of the changes along with some helpful hints.

File Your Federal Income Tax Return Early

  • Completing your FAFSA will be faster, easier, and more accurate if you and your parents have already completed your IRS federal income tax returns.
  • If you haven't filed, you can still complete your FAFSA using estimated information and correct it after you file your taxes.

For more information, refer to How to Apply.

FAFSA IRS Data Retrieval - New for 2012-13

  • When completing your FAFSA, use IRS Data Retrieval to download tax information directly from the IRS to your FAFSA.
  • If you complete your FAFSA using estimated income information, you may return to www.fafsa.gov and use IRS Data Retrieval to correct and document income and tax information.
    • NEW for 2012-13

    IRS Data Retrieval - When completing your FAFSA, select the IRS Data Retrieval option.

    IRS Tax Transcript - You may be required to order a Tax Transcript from the IRS.

    A personal copy of your tax return is no longer accepted.

  • Using IRS Data Retrieval will reduce the chances that your FAFSA will be selected for verification. And if selected, it may reduce the documentation you must provide to the SDSU Office of Financial Aid and Scholarships.

Note: Tax data is available through IRS Data Retrieval within two weeks after you electronically submit your federal income tax return (or within eight weeks after mailing a paper tax return).

Students Selected for Verification - New for 2012-13

Income and tax information

A personal copy of a federal income tax return (IRS 1040, 1040A, 1040EZ) will no longer be accepted as documentation. The only acceptable documentation for verifying income and tax information will be —

  • IRS Data Retrieval on the FAFSA, or
  • An official IRS Tax Transcript if you are required to file a federal income tax return (student and parent).
    • Instructions for ordering a FREE IRS Tax Transcript will be included with documentation we request.
    • Avoid having to order your free IRS Tax Transcript by returning to www.fafsa.gov and using IRS Data Retrieval to correct and document yours and your parent's information.
    Note: In some cases you may not be able to use IRS Data Retrieval and will be asked to submit tax transcripts (e.g., married but filed separately or married in 2011 but have now separated or divorced, etc.)

Child support paid

  • If you or your parent paid child support in 2011, you will be asked to provide additional information concerning the children for whom the support was paid, and to whom the support was paid.

 

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Pell Grant Lifetime Limit

Students will now be limited to receiving a lifetime maximum of 12 full-time equivalent semesters of Pell Grant. This includes any Pell Grant award received to date.

The U. S. Department of Education will track eligibility and notify students and schools of who has reached, or is close to reaching, the 12-semester limit. Their Web site provides information and examples of how they calculate the equivalent of 12 full-time semesters.

Federal Direct Student and Parent Loans - New for 2012-13

Graduate students

Graduate Loans

Federal Direct Loans for graduate students will be unsubsidized at 6.8% interest.

Begins with amounts borrowed for academic terms beginning on or after July 1, 2012.

On amounts borrowed for academic terms beginning on or after July 1, 2012 —

  • Graduate students may borrow only unsubsidized Direct Loans.
  • Graduate students pay interest of 6.8% that begins to accrue once the loan is disbursed and capitalizes if not paid.
  • The full 1% loan fee will be charged on unsubsidized Direct Loans (the .5% up-front rebate is eliminated).
  • The full 4% loan fee will be charged on Grad PLUS Loans (the 1.5% up-front rebate is eliminated).

Note: The federal interest subsidy continues to apply to subsidized loan amounts you may have borrowed before July 1, 2012.

Undergraduate and teaching credential students

On amounts borrowed on or after July 1, 2012, and before July 1, 2014 —

  • Temporarily eliminates the federal interest subsidy provided during the six month grace period to students who are no longer enrolled at least half time and about to enter repayment. This is only on subsidized Direct Loan amounts borrowed July 1, 2012 through June 30, 2014.
  • On unsubsidized Direct Loans, the full 1% loan fee will be charged (the .5% up-front rebate is eliminated).

For more information, refer to Loans.

Parents

On Parent PLUS Loans borrowed on or after July 1, 2012 —

  • The full 4% loan fee will be charged on Parent PLUS Loans (the 1.5% up-front rebate is eliminated).

Read more about Parent PLUS Loans.

Satisfactory Academic Progress

To receive financial aid, you must be making satisfactory academic progress.  We are required by federal law to establish specific standards for how this is measured. 

NEW - once you fall below one of the minimum standards, you have only one chance for appeal per degree program and, if approved, one probationary semester in which to make progress.

Minimum standards

To be eligible to receive financial aid, you must:

  • maintain the minimum required grade point average (GPA)
  • successfully complete a minimum number of attempted units
  • complete your degree within a prescribed length of time

Once you fail to meet one or more of these standards, you are not eligible to receive financial aid.   (Read more about the minimum GPA, minimum units required and maximum unit limits in the “Academic Progress” section of the Web site.)

Appeal

If you had an extenuating circumstance beyond your control that affected your ability to maintain satisfactory academic progress, you may appeal your ineligibility.  You must be able to document the circumstance as well as the steps you’ve taken to resolve the situation and successfully move forward.

For example, inability to understand course material and pass the class is not an extenuating circumstance, however, a serious illness may be considered as a circumstance beyond your control.

Financial aid probation

You are on financial aid probation only after you become ineligible and receive an approved appeal.

  • With an approved appeal, your units and grades will be evaluated at the end of your probationary semester (or summer term, if attending SDSU).
  • If you do not maintain satisfactory academic progress during your probationary semester, you will not be eligible to receive financial aid the following semester.
  • Failure to meet the standards set forth in your approved appeal will result in your financial aid ineligibility.
  • You may reestablish eligibility by meeting the standards on your own, without the benefit of financial aid.

 

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