Department of Education
Federal Student Aid's (FSA’s) Federal Pell Grant (Pell) and William D. Ford Direct Loan (Direct Loan) programs are considered Phase 2 programs per OMB Circular A-123, Appendix C (“A-123C”). The major causes of improper payments (IP) and unknown payments (UP) in FY 2025 are related to documentation deficiencies, incorrect amount, and student withdrawal deficiencies. These root causes are consistent with those identified for prior year IP and UP estimates. FSA has developed corrective action plans to mitigate and prevent IPs and UPs that are within FSA’s control. For example, through the Student Aid and Borrower Eligibility (SABER) Initiative, FSA has implemented the Fostering Undergraduate Talent by Unlocking Resources for Education (FUTURE) Act and Free Application for Federal Student Aid (FAFSA) Simplification Act for the 2024-2025 FAFSA which streamlines and strengthens the collection of data used to determine eligibility for student financial assistance. IPs and UPs that are outside of FSA’s control are mainly attributed to challenges at institutions that are responsible for disbursing Pell and Direct Loan funds. FSA will continue to provide training to institutions through various avenues, such as the FSA Annual Conference, and perform various oversight activities to ensure institutions meet FSA requirements for institutional eligibility, financial responsibility, and administrative capability.
The FY 2025 IP and UP rate for the Pell program is 1.07%, down from 2.64% in FY 2024. The decrease in the FY 2025 Pell estimate from FY 2024 is primarily due to the implementation of the authorities provided in the FUTURE Act which now allows FSA to collect federal tax information directly from the Internal Revenue Service (IRS), and therefore misreported income on the FAFSA is significantly reduced as the information is verified and directly collected from the IRS. This reduction is a significant win for the Pell Grant program as misreported income on the FAFSA has been the Pell Grant program's most significant root cause of improper payments in both rate and dollars since the implementation of its statistically valid Sampling and Estimation Methodology Plan (S&EMP) in FY 2019. The FY 2025 IP and UP rate for the Direct Loan program is 0.99%, up from 0.94% in FY 2024. The increase in the FY 2025 Direct Loan estimate from FY 2024 is primarily due to an increase in IPs derived from compliance audit data.
The Department also estimated the FY 2025 IP and UP rates for one non-FSA Phase 2 program: Education Stabilization Fund (ESF). The FY 2025 IP and UP rate for the ESF program is 0.004%. The ESF program experienced overpayments that were beyond the agency’s control, due to automatic rounding errors and inadequate expenditure data. These discrepancies occurred both within Excel and within other system-based processes. Preventing rounding within system-based processes is inherently challenging. When rounding occurs in a system and is subsequently recalculated in Excel, discrepancies can arise, resulting in minor differences in amounts. Consequently, it is difficult for states to prevent these rounding errors, which is why these errors are classified as beyond the agency’s control.
The Department continues its efforts to collect confirmed IPs. Although the Department has determined that payment recapture audits would not be cost-effective for any of its programs and activities, the Department identifies and recovers IPs through other recovery mechanisms. The Department works with grantees and Title IV (FSA) program participants to resolve and recover amounts identified in compliance audits, OIG audits, and program reviews. Additionally, the Department analyzes the return of grant funds from recipients to determine whether they are due to IPs. When an IP is confirmed and deemed collectible, the Department establishes an account receivable and pursues collection. Additionally, the Department has discretion to decide not to collect IPs from grantees in cases where it determines that pursuing collection would cause more harm to the federal interest.
Finally, through its improper payment risk assessments, the Department did not identify any new programs as high risk requiring an estimate. The Department continues to maintain PIIA compliance by emphasizing the prevention of improper payments. Excessive drawdowns can reveal grantee cash management issues, an area the Department’s grants management community continues to address through its technical assistance to grantees.
Agency level Payment Integrity results
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Payment accuracy rate
(Based on federal funding spent by programs determined by agencies as susceptible to improper payments)
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Improper payments rate
(Based on federal funding spent by programs determined by agencies as susceptible to improper payments)
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Unknown payments rate
(Based on federal funding spent by programs determined by agencies as susceptible to improper payments)
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Department of Education improper payment estimates over time
View as:
Chart toggle amounts:Proper paymentsOverpaymentUnderpaymentTechnically improperUnknown
Recovery information
Please note: Overpayment amounts recovered are reported in the year they were recovered, not the year they were identified. Therefore it is possible in some years to have a recovery rate greater than 100%.
| Overpayment amount identified through recovery activities | $443.54 M |
| Overpayment amount recovered through recovery activities | $430.79 M |
| Recovery activities recovery rate | 97.13 % |
Why recovery audits are not cost effective in certain programs
The Department has determined that payment recapture audits would not be cost effective for any of its loan and grant programs or for contracts. The Department identifies and recovers improper payments through sources other than payment recapture audits and works with grantees and Title IV (FSA) program participants to resolve and recover amounts identified in compliance audits, OIG audits, and the Department-conducted program reviews. The Department also analyzes the return of grant funds from recipients to determine whether they are due to improper payments. When an improper payment is detected and deemed collectible, the Department establishes an account receivable and pursues collection. Recoveries are also made through grant program, payroll, and other offsets. Recipients of Department funds can appeal management’s decisions regarding funds to be returned to the Department, or they may go bankrupt before the Department can collect, thereby delaying or decreasing the amounts the Department is able to collect. Additionally, the Department has discretion to decide not to collect improper payments from grantees in cases where it determines that pursuing collections would cause more harm to the federal interest. For these reasons, not all identified improper payments will ultimately be recovered and recoveries may not occur in the same year the improper payments were identified.
Intentional monetary loss improper payments are more commonly referred to as financial fraud and are overpayments that occur on purpose. This agency reported $8.62M of confirmed fraud in this reporting cycle.
Supplemental Information
The Department of Education utilizes the Treasury's Do Not Pay (DNP) system to verify and cross-check information across multiple databases, ensuring that the Department avoids making improper payments. On a monthly basis, the agency conducts checks for any matches to relevant data sources. To date, only one match has been identified, which signaled a potential issue that necessitated further investigation and corrective action, thereby preventing additional matches from occurring.
The Working System has reduced/prevented improper payments:
ED has not identitied incorrect information in the Working System.
ED was found compliant during the most recent PIIA compliance review.
Show full list of compliant programs 
Compliant programs:
- Adult Education - Basic Grants to States
- Adult Education National Leadership Activities
- Alaska Native Educational Programs
- American History and Civics Education
- American Indian Vocational Rehabilitation Services
- American Overseas Research Centers
- American Printing House for the Blind
- Arts in Education
- Augustus F. Hawkins Centers of Excellence - Teacher Preparation and Development
- Business and International Education Projects
- Career and Technical Education - Basic Grants to States
- Career and Technical Education - Grants to Native Americans and Alaska Natives
- Career and Technical Education - National Programs
- Centers for International Business Education
- Charter Schools
- Child Care Access Means Parents in School
- Civil Rights Training and Advisory Services (also known as Equity Assistance Centers)
- Competitive Grants for State Assessments
- Comprehensive Centers
- Comprehensive Literacy Development
- Congressionally Directed Spending - Rehabilitation Services and Disability Research
- Consolidated Grant to the Outlying Areas
- Contractual Services
- Credit Enhancement for Charter School Facilities
- Credit Programs
- DC Opportunity Scholarship Program
- Directed Grants and Awards
- Disability Innovation Fund (DIF)
- Disaster Recovery Assistance for Education
- Education Evaluation and Technical Assistance Grants
- Education Innovation and Research (formerly Investing in Innovation (i3) Fund)
- Education Research, Development and Dissemination
- Education Stabilization Fund
- Education for Homeless Children and Youth
- English Language Acquisition State Grants
- Federal Family Education Loan (FFEL)
- Federal Pell Grant Program
- Federal Perkins Loan (Perkins)
- Federal Real Property Assistance Program
- Federal Supplemental Educational Opportunity Grant (FSEOG)
- Federal Work-Study
- Fund for the Improvement of Postsecondary Education
- Gaining Early Awareness and Readiness for Undergraduate Programs
- Gallaudet University
- Graduate Assistance in Areas of National Need
- Grants for State Assessments and Related Activities
- Health Education Assistance Loan (HEAL)
- Helen Keller National Center for Youths and Adults Who Are Deaf-Blind
- Higher Education Institutional Aid
- Howard University
- Impact Aid
- Impact Aid Facilities Maintenance
- Indian Education - Special Programs for Indian Children
- Indian Education Grants to Local Educational Agencies
- Indian Education National Activities (State Tribal Education Partnership (STEP) and Native American Language (NAL)
- Innovative Approaches to Literacy; Promise Neighborhoods; Full-Service Community Schools; and Congressionally Directed Spending for Elementary and Secondary Education Community Projects
- Innovative Rehabilitation Training
- International Research and Studies
- Javits Gifted and Talented Students Education
- Language Resource Centers
- Magnet Schools Assistance
- Migrant Education College Assistance Migrant Program
- Migrant Education Coordination Program
- Migrant Education High School Equivalency Program
- Migrant Education State Grant Program
- Minority Science and Engineering Improvement
- National Resource Centers Program for Foreign Language and Area Studies or Foreign Language and International Studies Program and Foreign Language and Area Studies Fellowship Program
- National Technical Institute for the Deaf
- Native Hawaiian Career and Technical Education
- Native Hawaiian Education
- Overseas Programs - Doctoral Dissertation Research Abroad
- Overseas Programs - Faculty Research Abroad
- Overseas Programs - Group Projects Abroad
- Overseas Programs Special Bilateral Projects
- Personnel Compensation and Benefits
- Postsecondary Education Scholarships for Veteran's Dependents
- Program of Protection and Advocacy of Individual Rights
- Randolph-Sheppard - Financial Relief and Restoration Payments
- Ready-To-Learn Television
- Rehabilitation Long-Term Training
- Rehabilitation Services Client Assistance Program
- Rehabilitation Services Demonstration and Training Programs
- Rehabilitation Services Independent Living Services for Older Individuals Who are Blind
- Rehabilitation Services Service Projects
- Rehabilitation Services Vocational Rehabilitation Grants to States
- Rehabilitation Short-Term Training
- Rehabilitation Training Technical Assistance Centers
- Research in Special Education
- Rural Education
- School Safely National Activities
- Special Education - Personnel Development to Improve Services and Results for Children with Disabilities
- Special Education - Special Olympics Education Programs
- Special Education - State Personnel Development
- Special Education Educational Technology Media, and Materials for Individuals with Disabilities
- Special Education Grants to States
- Special Education Parent Information Centers
- Special Education Preschool Grants
- Special Education Studies and Evaluations
- Special Education Technical Assistance and Dissemination to Improve Services and Results for Children with Disabilities
- Special Education Technical Assistance on State Data Collection
- Special Education-Grants for Infants and Families
- Statewide Family Engagement Centers
- Statewide Longitudinal Data Systems
- Strengthening Minority-Serving Institutions
- Student Support and Academic Enrichment Program
- Supported Employment Services for Individuals with the Most Significant Disabilities
- Supporting Effective Educator Development Program
- Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants)
- TRIO Educational Opportunity Centers
- TRIO McNair Post-Baccalaureate Achievement
- TRIO Staff Training Program
- TRIO Student Support Services
- TRIO Talent Search
- TRIO Upward Bound
- Teacher Education Assistance for College and Higher Education Grant (TEACH)
- Teacher Quality Partnership Grants
- Teacher and School Leader Incentive Grants (formerly the Teacher Incentive Fund)
- Title I Grants to Local Educational Agencies
- Title I State Agency Program for Neglected and Delinquent Children and Youth
- Traditionally Underserved Populations
- Training Interpreters for Individuals who are Deaf and Individuals who are Deaf-Blind
- Transition Programs for Students with Intellectual Disabilities into Higher Education
- Tribally Controlled Postsecondary Career and Technical Institutions
- Twenty-First Century Community Learning Centers
- Undergraduate International Studies and Foreign Language Programs
- William D. Ford Federal Direct Loan Program
| Program name | When was the last improper payment risk assessment conducted? | Likely to be susceptible to significant improper payments? | Substantial changes made to the assessment methodology used for the reporting cycle |
|---|---|---|---|
| Adult Education - Basic Grants to States | 2025 |
 No
|
|
| Adult Education National Leadership Activities | 2019 |
No
|
|
| Alaska Native Educational Programs | 2025 |
No
|
|
| American History and Civics Education | 2025 |
No
|
|
| American Indian Vocational Rehabilitation Services | 2024 |
No
|
|
| American Overseas Research Centers | 2019 |
No
|
|
| American Printing House for the Blind | 2025 |
No
|
|
| Arts in Education | 2025 |
No
|
|
| Augustus F. Hawkins Centers of Excellence - Teacher Preparation and Development | * | ||
| Business and International Education Projects | * | ||
| Career and Technical Education - Basic Grants to States | 2025 |
No
|
|
| Career and Technical Education - Grants to Native Americans and Alaska Natives | 2025 |
No
|
|
| Career and Technical Education - National Programs | 2020 |
No
|
|
| Centers for International Business Education | 2019 |
No
|
|
| Charter Schools | 2025 |
No
|
|
| Child Care Access Means Parents in School | 2025 |
No
|
|
| Civil Rights Training and Advisory Services (also known as Equity Assistance Centers) | 2019 |
No
|
|
| Competitive Grants for State Assessments | 2020 |
No
|
|
| Comprehensive Centers | 2025 |
No
|
|
| Comprehensive Literacy Development | 2025 |
No
|
|
| Congressionally Directed Spending - Rehabilitation Services and Disability Research | * | ||
| Consolidated Grant to the Outlying Areas | 2025 |
No
|
|
| Contractual Services | 2024 |
No
|
|
| Credit Enhancement for Charter School Facilities | 2025 |
No
|
|
| Credit Programs | 2025 |
No
|
|
| DC Opportunity Scholarship Program | 2025 |
No
|
|
| Directed Grants and Awards | * | ||
| Disability Innovation Fund (DIF) | 2022 |
No
|
|
| Disaster Recovery Assistance for Education | 2025 |
No
|
|
| Education Evaluation and Technical Assistance Grants | * | ||
| Education for Homeless Children and Youth | 2025 |
No
|
|
| Education Innovation and Research (formerly Investing in Innovation (i3) Fund) | 2025 |
No
|
|
| Education Research, Development and Dissemination | 2025 |
No
|
|
| Education Stabilization Fund | 2025 |
No
|
|
| English Language Acquisition State Grants | 2025 |
No
|
|
| Federal Family Education Loan (FFEL) | 2023 |
No
|
|
| Federal Pell Grant Program | 2025 |
 Yes
|
|
| Federal Perkins Loan (Perkins) | 2023 |
No
|
|
| Federal Real Property Assistance Program | * | ||
| Federal Supplemental Educational Opportunity Grant (FSEOG) | 2023 |
No
|
|
| Federal Work-Study | 2023 |
No
|
|
| Fund for the Improvement of Postsecondary Education | 2024 |
No
|
|
| Gaining Early Awareness and Readiness for Undergraduate Programs | 2025 |
No
|
|
| Gallaudet University | 2024 |
No
|
|
| Graduate Assistance in Areas of National Need | 2025 |
No
|
|
| Grants for State Assessments and Related Activities | 2025 |
No
|
|
| Health Education Assistance Loan (HEAL) | 2023 |
No
|
|
| Helen Keller National Center for Youths and Adults Who Are Deaf-Blind | 2025 |
No
|
|
| Higher Education Institutional Aid | 2024 |
No
|
|
| Howard University | 2025 |
No
|
|
| Impact Aid | 2024 |
No
|
|
| Impact Aid Facilities Maintenance | 2021 |
No
|
|
| Indian Education - Special Programs for Indian Children | 2025 |
No
|
|
| Indian Education Grants to Local Educational Agencies | 2025 |
No
|
|
| Indian Education National Activities (State Tribal Education Partnership (STEP) and Native American Language (NAL) | 2019 |
No
|
|
| Innovative Approaches to Literacy; Promise Neighborhoods; Full-Service Community Schools; and Congressionally Directed Spending for Elementary and Secondary Education Community Projects | 2024 |
No
|
|
| Innovative Rehabilitation Training | 2019 |
No
|
|
| International Research and Studies | 2019 |
No
|
|
| Javits Gifted and Talented Students Education | 2025 |
No
|
|
| Language Resource Centers | 2019 |
No
|
|
| Magnet Schools Assistance | 2024 |
No
|
|
| Migrant Education College Assistance Migrant Program | 2025 |
No
|
|
| Migrant Education Coordination Program | 2019 |
No
|
|
| Migrant Education High School Equivalency Program | 2025 |
No
|
|
| Migrant Education State Grant Program | 2025 |
No
|
|
| Minority Science and Engineering Improvement | 2025 |
No
|
|
| National Resource Centers Program for Foreign Language and Area Studies or Foreign Language and International Studies Program and Foreign Language and Area Studies Fellowship Program | 2025 |
No
|
|
| National Technical Institute for the Deaf | 2025 |
No
|
|
| Native Hawaiian Career and Technical Education | 2019 |
No
|
|
| Native Hawaiian Education | 2025 |
No
|
|
| Overseas Programs - Doctoral Dissertation Research Abroad | 2019 |
No
|
|
| Overseas Programs - Faculty Research Abroad | * | ||
| Overseas Programs - Group Projects Abroad | 2020 |
No
|
|
| Overseas Programs Special Bilateral Projects | * | ||
| Personnel Compensation and Benefits | 2025 |
No
|
|
| Postsecondary Education Scholarships for Veteran's Dependents | * | ||
| Program of Protection and Advocacy of Individual Rights | 2025 |
No
|
|
| Randolph-Sheppard - Financial Relief and Restoration Payments | 2022 |
No
|
|
| Ready-To-Learn Television | 2025 |
No
|
|
| Rehabilitation Long-Term Training | 2024 |
No
|
|
| Rehabilitation Services Client Assistance Program | 2025 |
No
|
|
| Rehabilitation Services Demonstration and Training Programs | 2019 |
No
|
|
| Rehabilitation Services Independent Living Services for Older Individuals Who are Blind | 2025 |
No
|
|
| Rehabilitation Services Service Projects | * | ||
| Rehabilitation Services Vocational Rehabilitation Grants to States | 2025 |
No
|
|
| Rehabilitation Short-Term Training | 2019 |
No
|
|
| Rehabilitation Training Technical Assistance Centers | 2020 |
No
|
|
| Research in Special Education | 2025 |
No
|
|
| Rural Education | 2025 |
No
|
|
| School Safely National Activities | 2024 |
No
|
|
| Special Education - Personnel Development to Improve Services and Results for Children with Disabilities | 2025 |
No
|
|
| Special Education - Special Olympics Education Programs | 2025 |
No
|
|
| Special Education - State Personnel Development | 2025 |
No
|
|
| Special Education Educational Technology Media, and Materials for Individuals with Disabilities | 2025 |
No
|
|
| Special Education Grants to States | 2025 |
No
|
|
| Special Education Parent Information Centers | 2025 |
No
|
|
| Special Education Preschool Grants | 2025 |
No
|
|
| Special Education Studies and Evaluations | * | ||
| Special Education Technical Assistance and Dissemination to Improve Services and Results for Children with Disabilities | 2025 |
No
|
|
| Special Education Technical Assistance on State Data Collection | 2025 |
No
|
|
| Special Education-Grants for Infants and Families | 2024 |
No
|
|
| Statewide Family Engagement Centers | 2025 |
No
|
|
| Statewide Longitudinal Data Systems | 2025 |
No
|
|
| Strengthening Minority-Serving Institutions | 2025 |
No
|
|
| Student Support and Academic Enrichment Program | 2025 |
No
|
|
| Supported Employment Services for Individuals with the Most Significant Disabilities | 2025 |
No
|
|
| Supporting Effective Educator Development Program | 2025 |
No
|
|
| Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) | 2025 |
No
|
|
| Teacher and School Leader Incentive Grants (formerly the Teacher Incentive Fund) | 2025 |
No
|
|
| Teacher Education Assistance for College and Higher Education Grant (TEACH) | 2023 |
No
|
|
| Teacher Quality Partnership Grants | 2025 |
No
|
|
| Title I Grants to Local Educational Agencies | 2025 |
No
|
|
| Title I State Agency Program for Neglected and Delinquent Children and Youth | 2025 |
No
|
|
| Traditionally Underserved Populations | 2019 |
No
|
|
| Training Interpreters for Individuals who are Deaf and Individuals who are Deaf-Blind | 2019 |
No
|
|
| Transition Programs for Students with Intellectual Disabilities into Higher Education | 2025 |
No
|
|
| Tribally Controlled Postsecondary Career and Technical Institutions | 2024 |
No
|
|
| TRIO Educational Opportunity Centers | 2025 |
No
|
|
| TRIO McNair Post-Baccalaureate Achievement | 2025 |
No
|
|
| TRIO Staff Training Program | 2019 |
No
|
|
| TRIO Student Support Services | 2025 |
No
|
|
| TRIO Talent Search | 2025 |
No
|
|
| TRIO Upward Bound | 2025 |
No
|
|
| Twenty-First Century Community Learning Centers | 2024 |
No
|
|
| Undergraduate International Studies and Foreign Language Programs | 2019 |
No
|
|
| William D. Ford Federal Direct Loan Program | 2025 |
Yes
|
* Assessment year is not displayed because one or more of the following statements is true:
- Not required to conduct a risk assessment under the Payment Integrity Information Act of 2019,
- Already assessed for improper payment risk under a different name in a prior reporting period, and/or
- New and planning to perform a risk assessment in the future.