Transcript Tuition Grant Program (TGP)

Tuition Grant Program (TGP)
OVERVIEW OF PROGRAM
FEBRUARY, 2009
TGP Overview Table of Contents
2
 Program Explanation
 TGP Description
 Annual Process
 Annual Benefit



Annual Benefit Examples
Expenses Not Covered
Length of Payments
 Eligibility
 Eligible Employees



Pages 3-10
Pages 11-18
Breaks in Service
Eligible Institutions
Eligible Children

Child’s College/University Attendance
 Additional Factors
 Taxability
 Financial Aid
 How and When to Apply
 For More Information
TGP Overview: February 2009
Pages 19-25
Pages 26-28
Page 29-30
3
Program Explanation
TGP Overview: February 2009
TGP Description
4
 Stanford’s Tuition Grant Program assists employees by helping to
pay for their dependent children's undergraduate college
education


TGP provides tax-exempt payments directly to accredited colleges and
universities toward the cost of the child(ren)’s tuition
Please see comprehensive program guidelines, Frequently Asked
Questions, and download the application form at:
http://hreap.stanford.edu
 The maximum benefit is the lesser of:


The cost of tuition (or fees) for your child’s school, less any applicable
grants or scholarships or
Up to one-half of Stanford University’s tuition (Half of the current
(2009/2010) Stanford tuition is $18,690.00)

The benefit payable on your behalf will be calculated each semester, quarter, or
each time you apply for TGP benefits and seek an authorization letter
TGP Overview: February 2009
TGP Description (cont’d)
5
 The maximum full-time benefit for the 2009-2010 academic year –
including summer term – is:
$ 18,690
$ 9,345
$ 6,230
for the full academic year
for each semester
for each quarter
 Payments are only made for the current academic year after an
application has been submitted and approved. You may not apply for
benefits retroactively.
TGP Overview: February 2009
Annual TGP Process
6
By July 1, submit
a complete TGP
application form
Application is
reviewed for
eligibility
Eligible
employee issued
an authorization
letter
Employee forwards
letter to child’s
college to provide
billing instructions
Reapply each year by July 1 or separate term
TGP Overview: February 2009
The child’s
institution submits
invoices to TGP for
payment
Annual Benefit
7

TGP will pay some or all of the actual tuition (or required fees instead of tuition, such
as orientation, registration, or application fees) charged by an eligible educational
institution to matriculated students.

The amount TGP will pay is based on:

the percent of full-time equivalency (FTE) of the eligible employee’s appointment; e.g., 100%,
85%, 72%, 50%



If you work between 50% and 99% FTE at the time of payment, your benefit will be pro-rated by the percent
of your FTE. This is referred to as the “part-time benefit.”
the amount of half of the current Stanford University undergraduate tuition (half of the current
2009/2010 Stanford tuition is $18,690) This amount changes every academic year
the amount of tuition, less any applicable grants or scholarships, your child is being charged by
the college or university he/she/they are attending

If the child’s institution invoices more than the maximum benefit, TGP will pay up to
the maximum amount*

If the child’s institution invoices less than the maximum benefit, TGP will pay up to the
full amount of the invoice*
*Based on full time eligible employee; prorated if not full time
See the next page for examples of the TGP annual benefit
TGP Overview: February 2009
TGP Annual Benefit Examples
8
Employee’s FTE
Child’s
Tuition
Is Institution
Semester or
Quarter?
TGP Benefit*
Explanation
100% FTE
$13,200
Semester
$9,345.00
100% of allowable maximum of $ 9,345 per semester, since
employee works 100% FTE
85% FTE
$10,000
Semester
$ 7,943.25
85% of allowable maximum of $ 9,345 per semester, since
employee works 85% FTE
72% FTE
$6,000
Quarter
$ 4,485.60
72% of allowable maximum of $ 6,230 per quarter, since
employee works 72% FTE
50% FTE
$14,500
Quarter
$ 3,115.00
50% of allowable maximum of $ 6,230 per quarter, since
employee works 50% FTE
*Annual benefit up to ½ of Stanford’s current tuition rate, based on employee’s FTE and the maximum allowable
per semester or quarter. The above scenarios have tuition rates that differ from Stanford’s current tuition rate
($18,690 for 2009/2010).
TGP Overview: February 2009
Excluded Expenses
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TGP is to be used toward tuition and required fees.
Some examples of expenses that are not covered* are:
 Room and board
 Books and course materials
 Laboratory fees
 Expenses at any United States or foreign institution that are not
normally included in the basic tuition and fees by Stanford University,
the University of California, or the California State Universities
*See the comprehensive TGP guidelines for a complete listing of
expenses not covered by the TGP benefit
TGP Overview: February 2009
Length of Payments
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 The Program will make payments toward up to four years of work
required for a baccalaureate degree at the eligible institution
attended by the eligible child

Benefits will be paid for a maximum of:

12 quarters or 8 semesters of eligible attendance

If any TPG benefits for a child are taxable, benefits for that child will
not be paid toward more than 12 quarters or 8 semesters of eligible
attendance or after a period of 4 consecutive years, whichever is less.
 Benefits for extended part-time attendance may not exceed the
amount that would be paid for full-time attendance in a four-year
period, or the covered portion of such period.
 No TGP benefits continue beyond your eligible child’s attainment
of the baccalaureate degree.
TGP Overview: February 2009
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Eligibility for TGP
TGP Overview: February 2009
Eligibility—Employees
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 To participate in the TGP:

For Staff: A benefits-eligible University position that is six months or more
(four months or more, or to the extent provided in the collective bargaining
agreement for bargaining unit employees) and 50% FTE or greater.


In addition to your eligibility, you must have completed five years of continuing benefits-eligible
service in order to receive TGP benefits.
For Faculty and Senior Administrative Staff: A University appointment of six
months or longer [1]

Faculty and senior administrative staff are eligible for TGP when your appointment begins
 If both parents of an eligible child are Stanford employees, only one
four-year benefit period is allowed for each eligible child regardless of
which parent applies. The same limits and conditions apply as if
Stanford employed only one parent


Employees of organizations affiliated with the University are not eligible for
benefits under this Program, such as Carnegie Mellon
[1] Effective January 1, 2004, faculty of the School of Medicine who have a 7/8 or more assignment at the Palo Alto
Veterans Administration Medical Center will be treated as benefits-eligible for this purpose.
TGP Overview: February 2009
Eligibility—Breaks in Service
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Status
How TGP Eligibility is Affected
Paid leave
TGP payments continue without interruption
Unpaid leave
If seasonal layoff, time away does not count toward five-year qualifying service requirement. If service
requirement met, TGP payments continue without interruption
Sabbatical
TGP payments continue without interruption
Long-term
Disability
If the service requirement is met prior to going on LTD, your eligibility for this Program will continue during
the period for which those benefits are paid. If at any time during Long-Term Disability, your status changes
to LTD Termination with Benefits and prior to your disability, you have fulfilled the criteria to become an
Official Retiree, benefits under the Program will continue uninterrupted. If you do not qualify to become an
Official Retiree prior to your disability leave, and your status changes to LTD Termination with Benefits while
you are receiving TGP benefits, your eligible child’s coverage will stop when the current term ends.
Retirement
Your eligibility continues if you are a faculty or staff member who, after satisfying the service requirement,
retires from Stanford as an Official Retiree. Note: Your TGP benefit will be paid at the full-time rate only if you worked in
100% full-time service positions for more than half of the years you were a Stanford employee. If your service was not full time,
your TGP benefit will be based on the average percent of your full-time equivalency during your last 12 months of active service.
See Admin. Guide Memo 22.9.
Death
If the service requirement was met prior to death, benefit payments for your eligible children already
receiving benefits will continue; other children become eligible when they qualify, up to age 40 (TGP
benefits are taxable if the child is over age 24). However, all eligibility for the Program ends, if at the time of
death there are no eligible children participating in the Program, with the exception of those employees who
would qualify as an Official Retiree at the time of their death.
TGP Overview: February 2009
Eligibility—Breaks in Service (cont’d)
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Status
How TGP Eligibility is Affected
Your employment ends while you
are receiving TGP benefits
Your eligible child’s coverage will stop when the current term ends.
For example, if your employment terminates in October, the fall term
will be the last term covered.
You are a staff member, your
employment ends and you are
later re-hired into a benefitseligible staff position
You must complete another five-year period of continuous benefitseligible service to reestablish eligibility for the Program’s benefits,
unless any of the provisions of Administrative Guide Memo
22.1(d)(1) apply to you.
• The provisions in that memo include:
–If your employment is ended by a layoff and your employment is
reinstated within 24 months of the date of that layoff, your prior service is
bridged (i.e., counted as continuous through the layoff period), or
–If your employment otherwise ends, you return to work within one year,
and your department classifies your re-employment as a “reinstatement”
per Admin. Guide Memo 22.1(d)(1), your prior service is bridged.
If, in these two circumstances, you have already met the service requirement,
your participation can begin immediately, as long as you and your child meet all
other Program requirements. If your service is not bridged, your term of service
is counted from your new hire date.
You are rehired as a faculty or
senior admin. staff member
TGP Overview: February 2009
You will be immediately eligible for these Program benefits.
Eligibility—Institutions
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Accredited U.S. Institutions
 TGP payments will be made to accredited United States colleges and
universities listed in the most current edition of “Accredited Institutions of
Postsecondary Education” published by the American Council on Education
(ACE).
 The Benefits office has a copy of this book for your reference.
 If an institution is not listed in the ACE publication, the parent must provide
documentation that the units from the institution are transferable to Stanford
University. Send the documentation to the TGP Administrator so the institution’s
eligibility can be determined.
Foreign Institutions
 TGP payments may be made to foreign colleges and universities if Stanford
University determines, at its discretion, that the foreign institution’s
academic standards are equivalent to those of accredited United States
institutions. For an explanation on how payments are made to foreign
institutions, please see the TGP guidelines posted on hreap.stanford.edu
TGP Overview: February 2009
Eligibility—Children
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A child is considered eligible if he/she meets both of the following requirements:
The child is:
 A biological or legally adopted child, OR
 A stepchild who has lived with you for at least 12 months immediately before you request
benefits under the Program, OR
 A foster child who has lived with you for at least 24 months immediately before you request
benefits under the Program, OR
 A child of your domestic partner (as defined by the Domestic Partner Benefits Policy,
available through Benefits) who has lived with you for at least the 12 months immediately
before you request benefits under the Program, OR
 Your ward under a court-approved legal guardianship and has been your ward for at least
60 months
and
One or more of the following statements are true:
 The child is claimed as your dependent on your federal income tax returns, OR
 Your child provides less than 50% of their financial support, OR
 The child lives primarily with you when he/she is not away at school.
TGP Overview: February 2009
Eligibility—Children
(cont’d)
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 You must advise the TGP office immediately if your eligible child
in the Program withdraws from college during an academic year,
transfers to another college, or is no longer eligible. You are also
responsible for advising the TGP office if your employment
status changes during the period covered by the approved
application.

If you or your child becomes ineligible for the Program, Stanford
reserves the right to recover from you the Program benefits it paid
on your behalf.
 If your child withdraws before earning any units, and the child’s
institution refunds to Stanford the entire amount of tuition paid
by Stanford, the student loses no eligibility.

If the institution refunds more than half, but less than all, of the amount to
Stanford, the child loses one half of a quarter or semester. If the institution
refunds half or less than half of the amount, the child loses
a full quarter or semester of eligibility. You may issue a check made payable to
Stanford University for the amount not refunded by the child’s institution.
TGP Overview: February 2009
Child’s College/University Attendance
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Full-time Summer Attendance
 If your eligible child attends summer session and the Program pays for summer
attendance, a term of eligibility will be deducted from your remaining eligibility.
Part-time Attendance (Including Part-time Summer Attendance)
 If your eligible child takes eight or fewer units in a term, then the TGP will pay only half of
the equivalent full-time academic term of eligibility. The amount payable to the
institution cannot exceed one half of the amount available for that term, or the balance of
the annual benefit amount available.
Inter-term
 If your eligible child enrolls in an “inter-term” in between semesters, TGP will pay the
tuition as long as the course does not exceed the total maximum semester amount for the
year. The student loses no additional eligibility.

If the max semester amount has been used, a term of eligibility may be deducted from remaining
eligibility. An inter-term payment may deplete the remaining annual benefit amount available.
Simultaneous Attendance
 If your eligible child attends and is charged tuition by two eligible educational institutions
at the same time for the same course of study, TGP will pay benefits up to the amount that
would have been provided for the student to attend the primary institution full-time. This
amount will be adjusted if the combined attendance at both institutions is less than full
time.
TGP Overview: February 2009
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Additional Factors
TGP Overview: February 2009
Taxability Issues
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Non Taxable Benefit
 In order for TGP payments to be tax exempt, your child must meet the
following criteria:

The child is claimed as your dependent on your federal income taxes for the year
that includes the tuition payment date.
 Payments made on behalf of your eligible child(ren)* are made directly
to the college or university and are excluded from your gross income for
federal income tax purposes and are thus tax-exempt.
 Please consult a tax advisor to get specific guidance regarding taxes and
TGP payments
*Please review the comprehensive TGP Guidelines for who is considered an eligible child: http://hreap.stanford.edu
TGP Overview: February 2009
Taxability Issues (cont’d)
Taxable Payments
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 In general, if the child is not claimed as your dependent on your federal income
taxes, the benefit payments do not qualify for tax-exempt treatment and are subject to a
time limitation.
In
this case, you make tuition payments directly to the child’s institution.




After your application is reviewed and approved, you will be issued a letter outlining the reimbursement
procedures, taxable compensation, and maximum duration of the TGP benefit.
Next, when you receive the invoice from your child’s institution, you are responsible to pay it.
Next, provide a copy of the invoice and proof of your tuition payment to the Educational Assistance Programs
office in Human Resources.
 Payments to the institution must be made by the employee receiving the TGP benefits.
Reimbursements for current employees will be processed within two pay periods on either the 7th or 22nd of
the month, depending on the receipt date for proof of payment. Reimbursements for official retirees will be
sent to your home address approximately 15 days after receipt of proof of payment.
That
reimbursement will be classified as taxable supplemental compensation subject to
withholding. The University will not help pay any taxes due on such compensation.

Also, this supplemental compensation will not change your base salary; such other benefits will continue to be
calculated on your regular salary. The following examples describe three situations in which questions could
arise about the taxability of the Program funds.
 See Taxability Examples on the next page
NOTE: There are other circumstances that could result in benefits being treated as taxable
compensation. We strongly encourage you to consult your tax advisor concerning your specific
situation.
TGP Overview: February 2009
Taxability Issues (cont’d)
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Examples
● If tuition payments are made on behalf of a child of your domestic partner
and you have not legally adopted the child, the Program benefits will be treated as
taxable compensation to you.
● If the child provides over 50% of his or her own financial support, tuition
payments made on behalf of the child will be treated as taxable compensation to you.
● If the child has attained age 24 (19 if not a full-time student) and has gross
income equal to or exceeding the federal income tax exemption amount, and
is not disabled, the child will not qualify as a dependent and Program benefits will be
treated as taxable compensation to you.
TGP Overview: February 2009
Taxable Benefit Duration
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 The Program will reimburse the employee for tuition payments
toward up to four years of work required for a baccalaureate degree
at the eligible institution attended by the eligible child.
New Rule based on IRS code 409A: Taxable TGP benefits for a
child will not be paid toward more than 12 quarters or 8 semesters
of eligible attendance or after a period of 4 consecutive years,
whichever is less. Taxable TGP benefits must be taken in
consecutive years. The consecutive duration begins at the start of the
first term for which any taxable TGP benefit is paid and continues
through the consecutive time equivalent of the remaining TGP
credits. No TGP benefits continue beyond your eligible child’s
attainment of the baccalaureate degree.
*see examples of how this new rule applies in the TGP guidelines available at hreap.stanford.edu
TGP Overview: February 2009
Other Non-Taxable Payments
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Example: Late TGP Application Causes Employee to make
Tuition Payment Directly to Child’s Institution
 If you must make a payment for tuition directly to the child’s
institution due to a late TGP application submission, the TGP
Administrator will issue a reimbursement check to the school.

Once you have made the tuition payment, you must provide an invoice to show
the tuition amount and proof of payment. If the tuition was paid by check, the
front and back copies of the check are required.

Upon receipt of payment from the Tuition Grant Program, the child’s school will
in turn issue the reimbursement check.

Note: Stanford University is not responsible for the length of time it takes the child’s
school to reimburse you after they have received Stanford’s payment. If the child is over
the age of 18, the child’s school typically reimburses the child directly.
TGP Overview: February 2009
Financial Aid
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
Participation in Tuition Grant Program could affect other
financial aid benefits for your child’s education. Contact your
child’s Financial Aid Office for more information.

For Stanford University students, Educational Assistance
Programs (EAP) notifies the Financial Aid Office and you after the
application is processed. When registering, the student receives
the applicable credit toward Stanford’s tuition through the
process specified in the University’s registration procedures.
TGP Overview: February 2009
How and When to Apply
How to Apply
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 To apply for the TGP, complete and submit an
application between April 1-July 1 on behalf of
your eligible child for each partial or entire academic year
the child attends (includes summer session), or for each
change of school.
 Application forms are available at the campus Benefits
Office, the SLAC Benefits Office, or on the HR EAP web
site. Go to: http://hreap.stanford.edu
TGP Overview: February 2009
When to Apply
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
As soon as you know the college or university the child will attend, complete and submit
the application to the Educational Assistance Programs Office in Human Resources.
Applications are accepted during the academic year, but are due no later than July 1.

To ensure timely payments to your child’s school, you must submit applications
between April 1 and July 1 for the upcoming academic year. Failure to do so may
result in a required deposit, administrative delays, and a direct payment from you to the
institution. If payment is made by you, you may experience a delay in reimbursement
after the institution receives the TGP payment.

Faculty and staff located at SLAC should submit applications directly to the SLAC Benefits Office.
SLAC Benefits Office
2575 Sand Hill Road, Mail Bin 11
Menlo Park, CA 94028
Apply every academic year

For all semesters or quarters (includes summer session)–apply between April 1 and
July 1
TGP Overview: February 2009
For More Information
For More Information
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 Review the complete program guidelines and Frequently Asked
Questions online, and download the application form on the Human
Resources Educational Assistance Programs web site:
http://hreap.stanford.edu
 Call: (650) 736-2985 (local) or (877) 905-2985 (toll-free)

TGP is currently option 5 on the menu
 If you are unable to print the TGP application form that is online, you
can pick up a form in the Benefits office located at:


320 Panama Street, Bambi Modular Lobby
Note: If you are a SLAC employee, use the same forms, but submit them to
your own HR office at Mail Bin 11.
TGP Overview: February 2009