The Department of Education has published in the Federal Register the official notice announcing the FAFSA information that an institution and an applicant may be required to verify, as well as the acceptable documentation for verifying FAFSA information for the 2026-2027 award year.
What stays the same
For many applicants, income and tax information submitted via the direct data exchange between FAFSA and the IRS (thanks to the FUTURE Act) remains “pre-verified,” meaning when the tax info is transferred directly from the IRS and left unchanged, schools generally won’t need additional tax-return documentation.
If income/tax info can’t be automatically retrieved from the IRS (e.g., because someone filed a return in a U.S. territory, or is self-employed, or used a foreign tax authority), then manual entries may be subject to verification. Acceptable documentation includes free IRS transcripts or a copy of tax returns with applicable schedules.
What’s changed for identity verification (and V4/V5 groups)
One of the biggest updates: the identity verification process has been modernized and simplified, especially for applicants selected under verification tracking groups V4 or V5. These changes were previously announced earlier this year for 2025-26. Now the change has been documented in the Federal Register:
- The prior requirement for a signed “Statement of Educational Purpose” is no longer required for 2026–2027 (following a similar removal in 2025–2026).
- Institutions can now verify identity in one of two easier ways:
- A video call between the student and institutional personnel — in lieu of in-person notarized statements.
- Use of a third-party identity verification service that meets the authentication standard known as National Institute of Standards and Technology (NIST) Identity Assurance Level 2 (IAL2).
- For students enrolled in an eligible prison-education program, identity verification can be completed by an authorized official at the correctional facility — meaning incarcerated students selected for verification don’t need to appear in person or submit notarized statements.
Please remember that although these alternate methods are being provided, the Department encourages in-person verification as the preferred method when verifying identity, but the NIST IAL2 method is an acceptable alternative. If the school determines that a student is unable to appear in person, it can continue to use the signed notary statement method or it can use the new video call method. Please note, if a student chooses to verify their identity through a notary, they must do so in-person. Online notarization is not an acceptable method for our requirements.
These changes reflect a broader push to reduce burdens on students and institutions, while maintaining safeguards against fraud.
View the verification requirements published in the Federal Register here.
Implications for Financial Aid Offices
As a financial-aid professional, the 2026-2027 changes offer both opportunities and areas to plan for:
Streamlined verification workflow: With IRS data pre-verified and identity verification simplified via video calls or third-party vendors, you may see fewer manual documentation requests, which can reduce workload and speed up processing.
Need to update internal policies and communication templates: Because the “Statement of Educational Purpose” is no longer required, any institutional verification forms or student instructions must be revised accordingly. Make sure your office’s verification directions reflect the new acceptable documentation options.
Be ready for a possible spike in V4/V5 selections : Recent guidance from ED indicates a near-term increase in selection rates for V4 and V5 while new internal fraud-prevention screening is phased in.
Ensure compliance with documentation standards: If using third-party identity-verification services, confirm they meet NIST IAL2 standards. For incarcerated students, be aware of alternative verification procedures.
College Aid Services Webinar Training
If you need a refresher on V4/V5 verification, College Aid Services hosted a webinar back in August titled – “The New Rules: How to Handle V4/V5 and Conflicting Information.” You can watch the webinar on-demand here.
Additional training resources will become available in the coming months.