If, like me, you are the parent of a high school senior, it’s likely that you submitted a FAFSA sometime between last fall and last month. The Free Application for Federal Student Aid, FAFSA, is a national system run by the US Department of Education that all college applicants must submit.
Different from the first time we filled out the FAFSA for our oldest child, when we did it this time, there was a new tool that allowed us to link directly into our IRS taxpayer account and pull in our most recent tax return data, saving hours of time. That’s a good thing, right? Maybe not.
On April 6, the IRS Commissioner acknowledged during testimony before the Senate Finance Committee that the tool was compromised by hackers who may have stolen the tax data of up to 100,000 individuals. Not good at all! The IRS is now confirming that around 8,000 fraudulent tax returns were filed using that data, resulting in refunds issued to criminals, not legitimate taxpayers. The full scope of this breach is not yet clear.
If you submitted a FAFSA for this year, you may want to monitor your credit actively for at least the next six months. If you get an unexpected or unusual notice from the IRS, call them right away and investigate it. Let them know you are concerned that you could be a victim of the FAFSA tool breach. The IRS says they are contacting all impacted parties, but this will take some time. Play it safe and watch your credit accounts carefully, as well as your mail, to be sure no one is opening accounts in your name. Remember that the IRS will not contact you by email, so don’t fall for any phishing scams.
This is a pretty disappointing and serious breach. We should expect our government to secure our sensitive information and they have repeatedly failed to do so, across multiple agencies. This underscores just how complex a problem information security is. I am quite certain that both the Department of Education and the IRS took all reasonable steps to ensure the security of the tool. Even so, it was compromised.
Hopefully, you are not affected and you are instead enjoying your child’s decision as to which college or university they have or are deciding to attend.