Understanding Important Changes to R2T4 Exemptions

Managing Return to Title IV (R2T4) funding for students who withdraw from school just got more complex, as the Unites States Department of Education has now revised this process, effective July 1, 2021.

What exactly does the updated guidance mean for institutions and for their students? The new regulations contain three R2T4 exemptions:

1. Did the student give written confirmation for future attendance in the payment period or period of enrollment?
2. For standard and nonstandard term programs, written confirmation is required to cover a module in the same payment period/period of enrollment that begins no later than 45 calendar days after the end of the module during which the student ceased attending.
   1. For a subscription-based program, written confirmation is necessary for a date that occurs within the same payment period or period of enrollment and is no later than 60 calendar days after the student ceased his or her attendance.
   2. For a non-term program, written confirmation is required for a date that is no later than 60 calendar days after the student ceased his or her attendance.
3. Did the student complete all requirements for graduation from his or her program before completing the days or hours in the period the student was scheduled to complete? If yes,
   1. Student is not a withdrawal
   2. Aid recalculation rules apply
   3. This applies to all programs (with or without modules), including clock-hour programs.
   4. Schools only pay the student for hours successfully completed
4. Is my student considered a withdraw?
   1. In standard-term and nonstandard-term program offered in modules, it’s not considered a withdrawal if a student successfully completes Title IV eligible coursework:
      1. Equal to or greater than coursework required for a school’s definition of a half-time student for the period
      2. Half-time enrollment is at least half the workload of the applicable minimum requirements outlined in definition for a full-time student
   2. In a program offered in modules, a student is not considered to have withdrawn if the student successfully completes (i.e., earns a passing grade) the following:
      1. One module that includes 49% or more of the number of days in the payment period, excluding scheduled breaks of five or more consecutive days and all days between modules OR
      2. A combination of modules that when combined contain 49% or more of the number of days in the payment period, excluding scheduled breaks of five or more consecutive days and all days between modules. The 49% figure may NOT be rounded up (i.e., 48.7% CANNOT be rounded up to 49%). The 49% figure is based on the number of days in the overall payment period, not 49% of the modules the student was enrolled in for a particular payment period

Finally, before getting ready to do a Return to Title Calculation ask yourself the following questions to determine if one is needed:

When the student ceased to attend or failed to begin attendance in a scheduled course:

1. Did the student confirm attendance in writing for a future course in the payment period or period of enrollment?
2. Did the student complete all requirements for graduation?
3. Did the student successfully complete coursework equal to or greater than the coursework required for the institution’s definition of a half-time student for the payment period?
4. Did the student successfully complete a module or combination of modules that contain 49% or more of the number of days of the payment period (excluding scheduled breaks of 5 consecutive days or more and all days between modules)?

If yes to any question, the student may not be a withdrawal, but Pell recalculations may apply.

The major changes to withdrawal circumstances, defining what constitutes a “module” and calculating the required attendance days within these modules are complicated considerations that require a significant amount of attention.

As always, we are here to help financial aid departments and their institutions manage the ever-changing regulatory environment and find customized solutions to any issues they face. Schedule a call today