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Publication Date: August 2001

DCL ID: CB-01-12

Summary: Federal Perkins Loan Program IRS Skiptracing Service

 

August 2001

CB-01-12

SUBJECT: Federal Perkins Loan Program IRS Skiptracing Service

PUBLICATION REFERENCE: The Campus-Based Programs portion of the Federal Student Financial Aid Handbook; Federal Perkins Loan Program Regulations, 34 CFR, Part 674; and IRS Publication 1075 (Tax Information Security Guidelines for Federal, State, and Local Agencies), revised March 1999.

Dear Partner:

This letter explains the Internal Revenue Service (IRS)/Department of Education (ED) Skiptracing Service.

What is the Federal Perkins Loan Program IRS/ED Skiptracing Service?

The IRS/ED Skiptracing Service helps locate borrowers who are or will be going into default on repayment of their Federal Perkins Loans.

How does it work?

ED utilizes the IRS Skiptracing data to provide taxpayer addresses of defaulted borrowers to schools participating in the Federal Perkins Loan Program. The data are extracted monthly from the IRS Individual Master File at its National Computer Center. The data on the IRS file are updated weekly as new information is received about a taxpayer. The major update of all IRS files based on the latest annual tax return is usually accomplished by July of each year.

As a subscriber to this service, you would have the option of submitting requests in the form of typed lists/computer printouts or magnetic tapes (see Enclosure 3). Requests that we receive on listing/printouts will be processed and the results returned in the form of computer listings. Requests that we receive in the form of magnetic tape should be in the format as described in Enclosure 1. ED and the IRS use the first four (4) characters of the last name and the complete SSN for the Skiptracing match. These must be provided in requests for the IRS Skiptracing Services.

What are the requirements for me to participate in this service?

You must:

Do I have to use this service?

You are not required to use the IRS/ED Skiptracing Service for carrying out the due diligence provisions of the Federal Perkins Loan Program. Nonetheless, ED strongly encourages schools to use this service. This service is one of the most powerful tools available to schools for locating defaulted borrowers and is provided to schools free of charge.

What would I be required to do to participate?

To participate in the program, you must submit a Safeguard Procedures Report. In addition, you must provide ED with an annual Safeguard Activity Report (an update to the Safeguard Procedures Report) by September 30th of each year thereafter. Each report is described below:

Safeguard Procedures Report

The Safeguard Procedures Report is a complete description of how you process the federal tax return information (FTI) and the safeguards you established to prevent unauthorized disclosure or use of the information. A detailed description of the report is contained in Section 7.0 of IRS Publication 1075 entitled Reporting Requirements. Enclosure 4 to this document provides additional preparation instructions.

Safeguard Activity Report

In order to maintain eligibility in the IRS/ED Skiptracing Service, you must submit an annual update to the Safeguard Procedures Report called a Safeguard Activity Report. This report describes any changes that have occurred since you last reported and anything that could be demonstrative of safeguard efforts and/or awareness.

Can a servicer/contractor prepare these reports or the requests for information for me?

You may have a servicer/contractor prepare these reports, but they must be prepared according to the standards in Enclosure 4 and be signed by an authorized official of your school. The servicer/contractor must also file reports for their own facilities in accordance with these requirements.

We do not process requests for FTI from entities other than the principal subscriber (you). It is not acceptable for loan servicing centers to submit skiptracing requests on behalf of institutions. The principal subscriber must perform the proper certification of safeguard reports and request transmittals. Under appropriate safeguards, FTI may be furnished to servicers, but only the principal subscribers involved may request it.


What information will I receive if I participate in this service?

You will receive a Federal Perkins Loan IRS Skiptracing Address Report (Enclosure 2). The IRS data will be returned to ED by the first Friday of the month. IRS tapes will be processed and the address data sent to the requestors before the second week of the month. The total processing time is approximately two weeks from the time the input is received until the results are returned.

If a social security number (SSN) and name match is completed, the latest street address, post office box number, or other address, city state, and zip code furnished to IRS by the taxpayer will be provided. The zip code is the five-digit code assigned by the Postal Service. The two zeroes (00) in the last positions indicate that the area code (the first three digits) could be obtained, but the zone could not. Zeroes in all five positions indicate that the city or town could not be located in the Zip Code File maintained by IRS.

What is the deadline for my submissions?

The Safeguard Procedures and Activity Reports are due no later than September 30th of each year. You can review the reporting requirements for schools that participate in the Federal Perkins Loan Program approximately sixty (60) days on the Department's website www.ifap.ed.gov each year. Schools that fail to submit these reports will be removed from the service for the coming year. Reentry into the service will require submission of the entire Safeguard Procedures or Activity Reports again.

Where do I send my report?

You should mail your reports to:

U. S. Department of Education
FFELP/Federal Perkins Loan Program IRS Skiptracing Service
P. O. Box 4132
Greenville, TX 75403-4132

How should I send the reports?

You should mail the reports via the U. S. Postal Service only. Commercial carriers such as Federal Express and United Parcel Service cannot deliver to the above address.

Who should I call if I have a question about this letter?

If you have any questions regarding these procedures, please telephone Pamela Wills at (202) 401-3293 or e-mail her at Pamela.Wills@ed.gov. You may also contact Anna Allen at
(202) 708-8770 or e-mail her at Anna.Allen@ed.gov.


Sincerely,

Lois M. Moore
Acting Director
Campus-Based Operations
Schools Channel/SFA


Enclosure 1 Input/Output Layouts
In MS Word Format, file size 26KB, pages 4

Enclosure 2 Hard Copy Output Layout
In MS Word Format, file size 20KB, page 1

Enclosure 3 Transmittal Letter
In MS Word Format, file size 20KB, page 1

Enclosure 4 Supplemental Instructions for Safeguard Procedures Report
in MS Word Format, file size 23KB, pages 2

Enclosure 5 Fact Sheet for Protection of Federal Tax Return Information
In MS Word Format, file size 19KB, page 1