Payments/Reimbursements to Students for Non-Employment Purposes

Applies to: All payments to students when the payments are for non-employment purposes
  1. Purpose

    This Standard Practice Guide outlines the policy for payments to students from academic or other units when the payments are for non-employment purposes.

    To comply with US Department of Education regulations, student payments, awards, prizes, and gifts for academic pursuits or achievements must be reported to the Office of Financial Aid when paid for non-employment purposes.

    This policy covers all payments, awards, prizes, and gifts for academic pursuits or achievement.

    Academic pursuit is defined as any form of award, payment, reimbursement or other transaction to a student for the purpose of aiding his/her education, study, training, or research.

    This Standard Practice Guide does not include information about payments to students when the payments relate to a student’s employment at the University of Michigan.

  2. Overview

    Payments to students who are receiving other forms of financial aid for any purpose are a form of financial assistance and may require one of the following actions to be taken, regardless of the University system used to make the payment:

    • An adjustment to the financial aid award that the student has already received in the current semester or may receive in a subsequent semester, and /or
    • An adjustment to the student’s overall cost of attendance budget.

    The Office of Financial Aid (OFA) has the responsibility to determine whether adjustments are necessary.

    Unit representatives have the responsibility to inform OFA about the student’s financial assistance and to inform OFA of the term for which the payment is effective.

  3. Student Financial Aid Adjustments Resulting from Financial Assistance

    1. Payments to students with offsetting educational expenses:

      If the payment is for an educational expense, the student will incur or has incurred and the student’s expense will equal or exceed the amount of the payment, OFA will offset the payment with a Cost of Attendance (COA) budget adjustment when proper documentation is provided to OFA. If the payment amount is insufficient to cover the full cost of attendance, the student’s financial aid unmet need will be increased and the student may become eligible for additional financial aid.

      Examples of this type of payment are set allocations for conference attendance, which may not completely cover the total costs of the conference attendance.

    2. Payments to students without offsetting educational expenses:

      If there are no offsetting educational expenses for the student’s payment, the payment is counted toward the student’s overall financial aid for the academic year. If the payment/reimbursement amount causes the student’s total aid to exceed the Cost of Attendance (COA) budget, other financial aid sources will be reduced.

      Examples of this type of payment are cash payments or a gift card as an award or prize.

  4. Examples of Payments

    Examples of payments to students that must be reported of OFA are:

    1. Conference registration fees and travel when the payment or expense is not incurred on behalf of the University, but rather incurred for furtherance of the student’s own education experience such as: 1.Student merely listens and learns to further his/her education. 2. Student receives travel award for conducting research associated with their degree. (See Student Payment Form for additional examples)
    2. Reimbursement of supplies, course supplies for thesis, course related supplies, or other items purchased by the unit to complete an educational assignment. Examples include, but are not limited to:
      1. Editing
      2. Transcription
      3. Translation
      4. Binding
      5. Datasets
      6. ICPSR Classes
      7. Purchase of computer hardware and/or software,
    3. Awards and prizes include, but are not limited to:
      1. Third party payment or scholarship to offset educational costs,
      2. Funds awarded due to special or unusual circumstances (i.e. personal emergency)
      3. Student of the month or other recognition awards (achievement, services, etc.),
      4. Scholarship competition,
      5. Fitness awards,
      6. Student organization sponsored events,
      7. Student-life sponsored events.
  5. Processing the Payments & Reporting Payments to Office of Financial Aid (OFA)

    Payments are made using the financial aid module in PeopleSoft or other payment systems at the University (e.g. Concur).

    1. Payments made using the financial aid module:
      1. Lump sum travel awards

        The departmental representative (via the designated individual within OFA) must notify OFA by sending an email to OFA-reimburse@umich.edu including the following documentation: the student’s name and student id number, the purpose of the payment, the cost of travel, and whether the lump sum payment will equal or exceed the travel cost, and copies of receipts.

      2. Cash Awards and Prizes

        The departmental representative (via the designated individual within OFA) must process a financial aid payment, using a refundable item type.

    2. Payments processed outside of the financial aid module and paid to benefit the student’s academic pursuit must be reported to OFA. Students complete the Student Payment Request Form [see SPG Students Payments CTools site for form}.
      1. Expenses that are pre-paid by the unit using:
        1. P-Card: When processing (reconciling) the P-Card expense in Concur, include the student name and UMID in the business purpose for each transaction related to a student educational expense. The documentation attached to the Concur Expense Report should include the original receipts and the Student Payment Request Form, if available. EMail a PDF copy of the approved Concur expense report to OFA-reimburse@umich.edu noting that student reimbursements for educational expenses are included in the attached Concur Expense report.
        2. Purchase Order (PO or ePro requisition): When processing purchase orders that include expense lines supporting student’s educational expense (i.e. housing/accommodations, conference registrations, site tours, vehicle rentals), note the student(s) name and UMID(s) in the line item expense description. After purchase is consummated, email a PDF copy of the invoice to OFA-reimburse@umich.edu noting that student reimbursements for educational expenses are included in the attached report.
      2. Expenses that are reimbursed to the student (who is also an employee) using Concur: Process the Concur reimbursement request based on the unit’s standard business process. In the business purpose, include the student name and UMID. The documentation attached to the Concur Expense Report should include the original receipts and the Student Payment Request Form [link to form]. Send a PDF copy of the approved Concur expense report to OFA-reimburse@umich.edu noting that reimbursement is for educational expenses and is included in the attached Concur Expense report.
      3. Journal entries or recharges associated with a student’s educational pursuit (i.e. supplies from unit inventory, recharges for copies, inter-unit journal entries to share student expenses): Include the student name and UMID in the long description of the journal line and send a PDF copy of the journal entry and supporting documentation to OFA-reimburse@umich.edu noting that the attached journal is for the student’s educational expenses.
      4. Gift cards given as an award/prize must be reported to OFA via an email to SFPS@umich.edu. See SPG 501.12 for tax implications.
  6. Contacts for Information

    1. New item types can be requested by contacting the OFA User Liaison/Coordinator at 763-4303.
    2. Information about types of awards and prizes not listed in Section V is available by Contacting the OFA User Liaison/Coordinator at 763-4303.
    3. Questions regarding the impact on the student’s overall financial aid package should be directed to OFA at 763-6600 or to financial.aid@umich.edu.
  7. Related Topics/Materials

    1. Federal citation/guidance: Section 480(j) of the Higher Education Act of 1965, as Amended; 34 CFR 668.16(b); 34 CFR 673.5 (b) (2); Federal Student Aid Handbook 2009-10, page 3-138.
    2. Training documentation and materials available on the SPG Student Payments C-Tools site – Informational Resources for all Administrators. The documentation includes a template for the student payment form, list of OFA departmental liaisons and FAQ.
AttachmentSize
Student Payment Form33.83 KB
Printable PDF of SPG 601.3034.01 KB
Details Column 1
SPG number: 
601.30
Date issued: 
February 7, 2012
Next review date: 
February 7, 2017
Applies to: 
All payments to students when the payments are for non-employment purposes
Owner: 
Office of the Provost and Executive Vice President for Academic Affairs
Primary contact: 
Office of the Provost and Executive Vice President for Academic Affairs