Return of Title IV Aid (R2T4) Policy

How a Withdraw Affects Financial Aid

Federal regulations require Title IV financial aid funds to be awarded under the assumption that a student will attend the institution for the entire period in which federal assistance was awarded. When a student withdraws from all courses for any reason, including medical withdrawals, they may no longer be eligible for the full amount of Title IV funds they were originally scheduled to receive. The return of funds is based upon the premise that students earn their financial aid in proportion to the amount of time in which they are enrolled. A pro-rated schedule is used to determine the amount of federal student aid funds earned at the time of the withdrawal. Once 60% of the semester is completed, a student is considered to have earned all of their financial aid and will not be required to return any funds.

Federal law requires schools to calculate how much federal financial aid a student has earned if that student:

  • Completely withdraws, or
  • Stops attending before completing the semester, or
  • Does not complete all modules (courses that are not scheduled for the entire semester or payment period for which he/she has registered at the time those modules began).

Based on this calculation, Sandburg students who receive federal financial aid and do not complete their classes during a semester could be responsible for repaying a portion of the aid they received. Students who do not begin attendance must repay all financial aid disbursed for the term.

How a Withdrawal Affects Academics

The following policies will help you understand that a withdrawal potentially affects students academically as well as financially. We encourage students to read all the information below before making a final decision.
  • Academic policies on leaving Carl Sandburg College are available in our Academic Catalog.
  • Carl Sandburg College's tuition refund policy is separate from the federal regulations to repay unearned aid. Whether or not a student receives a tuition refund has no bearing on the amount he/she must repay to the federal aid programs. The tuition refund policy is available on the college website. For further information regarding tuition refunds, see our Refund Schedule.

How Earned Financial Aid is Calculated

Students who receive federal financial aid must “earn” the aid they receive by attending and participating in classes. The amount of federal financial assistance the student earns is pro-rated. Students who withdraw or do not complete the semester may be required to return some of the financial aid they were awarded.

Institutions are required to determine the percentage of Title IV aid “earned” by the student and to return the unearned portion to the appropriate aid programs. Regulations require schools to perform calculations within 30 days from the date the school determines a student’s complete withdrawal. The school must return the funds within 45 days of the calculation. For example, if a student completes 30% of the payment period, they earn 30% of the aid they were originally scheduled to receive. This means 70% of the scheduled awards remain “unearned” and must be returned to the federal government. Once 60% of the semester is completed, a student is considered to have earned all of his/her financial aid and will not be required to return any federal funds.

The following formula is used to determine the percentage of unearned aid that has to be returned to the federal government:

  • The percent earned is equal to the number of calendar days completed up to the withdrawal date, divided by the total calendar days in the payment period (less any scheduled breaks that are at least five days long).
  • The payment period is the entire semester. However, for students enrolled in modules (courses that are not scheduled for the entire semester or term), the payment period only includes those days for the module(s) in which the student is registered.
  • The percent unearned is equal to 100% minus the percent earned.

For students enrolled in modules: A student is considered withdrawn if the student does not complete all of the days in the payment period that the student was scheduled to complete. Carl Sandburg College will track enrollment in each module to determine if a student began enrollment in all scheduled courses. If a student officially drops courses in a later module while still attending a current module, the student is not considered withdrawn based on not attending the later module. However, a recalculation of aid based on a change in enrollment status may still be required.

Steps in the Return of Title IV Funds Policy

Carl Sandburg College will determine:

  1. The total amount of Title IV aid disbursed for the semester in which the student withdrew. A student’s Title IV aid is counted as aid disbursed in the calculation if it has been applied to the student’s account on or before the date, the student withdrew.

  2. The total amount of Title IV aid disbursed plus the Title IV aid that could have been disbursed for the semester in which the student withdrew.

  3. The percentage of Title IV aid earned as follows: The number of calendar days completed divided by the total number of calendar days in the semester in which the student withdrew. The total number of calendar days in a semester shall exclude any scheduled breaks of more than five days.
    • Days attended ÷ Days in enrollment period = Percentage completed

  4. If the calculated percentage completed exceeds 60%, then the student has “earned” all the Title IV aid for the enrollment period.

  5. Carl Sandburg College will calculate the amount of Title IV aid earned as follows: The percentage of Title IV aid earned (Step 2) multiplied by the total amount of Title IV aid disbursed or that could have been disbursed for the term in which the student withdrew.
    • Total aid disbursed × Percentage completed = Earned aid

  6. Amount of Title IV aid to be disbursed or returned:
    1. If the aid already disbursed equals the earned aid, no further action is required.
    2. If the aid already disbursed is greater than the earned aid, the difference must be returned to the appropriate Title IV aid program.
      • Total disbursed aid –Earned aid = Unearned aid to be returned
    3. If the aid already disbursed is less than the earned aid, then Carl Sandburg College will calculate a post-withdrawal disbursement. If your post-withdrawal disbursement includes loan funds, your school must get your permission before it can disburse them. You may choose to decline some or all of the loan funds so you do not incur additional debt. Your school may automatically use all or a portion of your post-withdrawal disbursement of grant funds for tuition, fees, and housing and food charges (as contracted with the school).

Types of Withdrawals

For financial aid purposes, there are two types of withdrawals: Official and Unofficial.

  • Official – An official withdrawal from Carl Sandburg College by the student. For the policy and procedure of Official Withdrawals, review the Carl Sandburg College Catalog, Admission Policies. Contact the Registrar for more information at 309.341.5234.
  • Unofficial – federal financial aid regulations consider a student to have an unofficial withdrawal if the student receives all F (failure) grades or a combination of F and W (withdraw) grades for the term.  


Determination of the Withdrawal Date

The withdrawal date used in the return calculation of a student’s federal financial aid is the actual date indicated on the official drop form. If a student stops attending classes without notifying Carl Sandburg College, the withdrawal date will be the last date of academic activity determined by Carl Sandburg College, through instructor grade reporting.


Withdrawing Prior to Completing 60% of a Term

Unless a student completes 60% of the term in which federal aid was disbursed, the student will be required to return all or part of the financial aid disbursed in the term. This applies to students who have officially or unofficially withdrawn.

When a Student Fails to Begin Attendance

Carl Sandburg College has a mandatory attendance policy for all classes. If a student does not attend at least once during the first four days of the semester, the student will be dropped from the course. Courses less than 16 weeks require attendance during the 100% refund period of the course.

Students Who Do Not Receive an Earned Grade in a Term 

Financial aid is awarded under the assumption the student will attend Carl Sandburg College for the entire term for which federal assistance was disbursed. Carl Sandburg College is required to have a procedure for determining whether a Title IV recipient who began attendance during a period completed the period or should be treated as a withdrawal. Students who attended class but failed to meet the academic requirements of the course are awarded a grade of F, this is an earned grade. Students who started a course but stopped attending class at some point and were given a grade of an F (failure), or W (withdrawal), are considered an “unofficial” withdrawal. When these grades are assigned, faculty will report the last date of an academically related activity to determine the Return of Title IV calculations.

Repayment Calculation Process

Once grades are posted for the student who receives either all Fs or F and W grades, Carl Sandburg College will return all unearned aid to the federal aid programs and the student will be charged. The Business Office will mail the bill to the student’s permanent address. The student is responsible for any balance due.

Definition of an Academic Related Activity

Examples of Carl Sandburg College's academic-related activities include but are not limited to physically attending a class where there is an opportunity for direct interaction between the instructor and students.
Proof of participation:
  • Exams or quizzes
  • Tutorials
  • Computer-assisted instruction
  • Completion of an academic assignment, paper or project
  • Participating in an online discussion about academic matters
  • Initiating contact with a faculty member to ask a question about the academic subject in the course

Documentation not acceptable as proof of participation:

  • Student’s self-certification of attendance that is not supported by school documentation
  • An apartment or lease in the Sandburg district
  • Participating in academic counseling or advising

Repayment of Federal Aid Programs

Federal regulations require that the following aid programs be subject to the repayment calculation if the student did not attend 60% of the term in the following order: 

  1. Unsubsidized Direct Stafford Loan
  2. Subsidized Direct Stafford Loan
  3. Direct PLUS (Parent) Loan
  4. Federal Pell Grant
  5. Federal Supplemental Education Opportunity Grant (FSEOG)


Overpayment of Federal Grants Funds

Federal regulations provide that 50% of the unearned amount of all federal grants be protected by the federal calculation. Any federal grant money subject to repayment is returned by Carl Sandburg College and that amount will be billed to the student’s billing account as a debt to Carl Sandburg College.

Additional Loan Information to Consider when Withdrawing

When a student is enrolled less than half time, the grace period begins. The student’s grace period for loan repayments for Federal Direct Unsubsidized and Subsidized Loans will begin on the day of the withdrawal from the school. If the student is not enrolled, at least half the time for more than six months, the loans will go into repayment. The student must contact the U.S. Department of Education or their lender(s) to make payment arrangements. Loans must be repaid by the loan borrower (student/parent) as outlined in the terms of the borrower’s promissory note. The student should contact the lender if they have questions regarding their grace period or repayment status.

Repayment of Unearned Funds and Consequences

Unearned funds are paid to the U.S. Department of Education by Carl Sandburg College on the student’s behalf. The school will return the funds within 45 days of the calculation. If the student owes any money to Carl Sandburg College resulting from the return of unearned federal financial aid, the student will be billed by Carl Sandburg College. If the student does not pay the funds, a hold is placed on the student’s account. This means students will not be permitted to register for classes or receive transcripts until the balance is paid. Students who do not pay may be subject to collection proceedings.

School and Student Responsibilities Regarding the R2T4 Policy & Process 

Carl Sandburg College’s responsibilities:
  • Providing each student with the information given in this policy
  • Identifying students affected by this policy and completing the R2T4 calculation
  • Informing the student of the result of the R2T4 calculation and any balance owed to Carl Sandburg Colleges as a result of a required return of funds
  • Returning any unearned Title IV aid that is due to the Title IV programs and, if applicable, notifying the borrower’s holder of federal loan funds of the student’s withdrawal date
  • Notifying student and/or PLUS borrower of eligibility for a Post-Withdraw Disbursement, if applicable

Student’s responsibilities:

  • Becoming familiar with the R2T4 policy and how withdrawing from all courses affects eligibility for Title IV aid
  • Resolving any outstanding balance owed to Carl Sandburg College
  • Resolving any repayment to the U.S. Department of Education as a result of an overpayment of Title IV grant funds