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Policy Title: Tuition Rebate Waiver Policy

Summary: You are eligible for tuition rebate benefits for yourself, spouse/partner, and eligible dependent children if you are employed in a full-time, regular position and are on the university payroll the first day of classes of a semester or summer term. Eligibility covers on-campus audited and credit courses provided by Drake University.

Policy Category: Human Resources
Policy Owner: Human Resources
Review Period: Three (3) Years
Policy Status: Revised March 2019
Effective Date: September 21, 2016

Tuition Rebate Waiver Policy

Eligibility

You are eligible for tuition rebate benefits for yourself, spouse/partner, and eligible dependent children if you are employed in a full-time, regular position and are on the university payroll on or before the first day of classes of a semester or summer term.  Eligibility covers on-campus and online audited and credit courses provided by Drake University.

Exclusions

The following programs and fees are not covered by the Tuition Rebate Waiver:

  • Travel courses (Including Study Abroad)
  • Tutorial or private instruction
  • Applied music lessons offered through the Music Department, unless included as a requirement part of a credit course
  • Non-credit music lessons (such as those offered by the Community School of Music)
  • Doctoral programs for spouse/partner and eligible dependent children
  • Mandatory and Non-Mandatory Fees. Examples include (but are not limited to):

Mandatory Fees

Non-Mandatory Fees

Olmsted Center

Parking

Health Center

Music

Student Activity

Laboratory

Technology

Study Abroad

 

Overload (Charged to Students taking more than 18 credit hours)


Questions about fees and excluded fees should be directed to Student Accounts, 515-271-2151.  Payments for fees and excluded items are the employee’s responsibility.  A hold will be placed on the student’s account until payment is made.

Some foreign exchange programs may qualify for tuition rebate waiver. Contact Human Resources for information.

Faculty and Staff Tuition Coverage

All full-time regular employees may carry a maximum of eight (8) credit hours of free tuition during each fall and spring semester and no more than eight (8) credit hours during the interim term and all summer terms combined.  For purposes of this policy, J-Term credit hours are combined with spring semester.  To be eligible for tuition rebate waiver, an employee must be a full-time regular employee on or before the first day of classes of that semester or session. 

When Courses May be Taken

Employees may take classes with permission of their manager or dean and President’s Council Member.  It is expected that exempt employees will continue to fulfill the duties of their regular work assignment as a condition of continued release during workday.  To receive full pay, non-exempt employees must make up the time during the same work-week in which the absence from work occurs.  If a credit course is considered by the manager or dean as necessary for current job performance, authorization may be granted to the individual to take the class on the basis of on-the-job training.  The time is considered paid time and does not need to be made- up.  Only on-the-job training credit class can be approved for fall and spring semesters and one credit class during the summer session.

J-Term Courses

Courses offered during the January term require a significant time investment over a short period of time.  Therefore, making up time during the same workweek or completing one’s regular work assignment pursuant to the regular tuition rebate waiver policy above is in most cases not feasible.  Staff who wish to participate in J-term classes may do so by taking vacation or personal time, subject to manager approval.

Tuition Rebate Waiver Process

Following receiving approval from the director or dean, if applicable, the employee should complete the online form.  Upon submission, the form is submitted to Human Resources to confirm the employee’s eligibility for the benefit.  Human Resources will then forward it to Student Financial Planning, where Student Financial Planning will coordinate the eligibility with other forms of financial aid for which the student may have applied.  Lastly, Student Financial Planning will forward the information to Student Accounts to be credited to the student’s student account.

FAFSA Requirement: For courses beginning after April 1, 2019, employees or their dependents who are pursuing an undergraduate degree program at Drake University are required to complete the FAFSA prior to July 1 (preceding the academic year of enrollment). This requirement ensures that all eligible students are considered for the Iowa Tuition Grant (a tuition/fees only award which offsets the cost of Drake’s Tuition Rebate benefit), as well as the Federal Pell Grant and other forms of assistance that can assist students with the cost of room, board, books and other educational expenses.

The FAFSA requirement may be waived for employees/dependents who can demonstrate that they would not qualify for the Iowa Tuition Grant. To determine eligibility for a waiver, employees may complete the FAFSA4caster—a simplified calculator that estimates the Estimated Family Contribution (EFC) that the FAFSA calculates. Employees utilizing this option must print the results page of the FAFSA4caster, write the employee/dependent’s name on it, and submit it to the Office of Student Financial Planning. Because the FAFSA-filing deadline is July 1st (preceding the academic year enrolled), it is recommended that employees seeking this waiver do so early enough that they could still complete the FAFSA by July 1st, in the event that the FAFSA-filing requirement is not waived. The FAFSA4caster can be accessed at https://studentaid.ed.gov/sa/fafsa/estimate.

Tuition Benefits for Dependents, Spouse/Partner

For purposes of this program, a child is considered a dependent if the child has not yet reached age 26, is not employed full-time; is not married, and is claimed by the employee as a dependent on the employee’s income tax return or can demonstrate that the employee provides principal support during the period for which tuition benefits are used.

The benefit levels for dependents and spouse/partner are as follows:

Undergraduate Tuition Waiver

0-1 Year of Service: 50% Waiver Benefit

1 + Years of Service*: 100% Waiver Benefit

Master’s Level Graduate Tuition Waiver

Employed on or after 1/1/69:  50% Waiver Benefit

Employed on or before 12/31/68: 100% Waiver Benefit

Doctoral Programs

No benefit is eligible for dependents, spouse/partner.

PharmD Tuition Waiver

1st Year/Sophomore Years: Undergraduate Tuition Waiver

P1 & P2 Years: Tuition Taxable as Income

P3 & P4 Years: Graduate Tuition Waiver

*Employees must have completed one year of service on the first day of classes of the semester or session to be eligible for the 100% waiver benefit.

Limitation on Dependent Participation

There is a limit of two persons, either one spouse/partner and one dependent or two dependent children (this limit includes dependent children participating in the Tuition Exchange Program), in any one school session.  (Individual employee participation does not count toward the two-person limit).

A Special Note About Taxability of Pharmacy Tuition Waiver

Doctor of Pharmacy students are charged graduate level tuition beginning in their 3rd year (P1).  However, for purposes of Tuition Rebate, qualifying students receive the undergraduate benefit for the first four years of their program.  Tax rules require that payment for coursework in a graduate level program is taxable income.

Accordingly, tuition rebate benefits become taxable  beginning with the 3rd year (P1) of the pharmacy program and federal, FICA and state taxes will be withheld on this taxable benefit and the taxable income will be reported on the employee’s W-2.

Taxation on Graduate Courses

Graduate tuition benefits for all tuition rebate participants are reported to tax agencies as taxable income with appropriate withholding amounts.  The amount of tuition benefits is included as taxable gross wages on the employee’s payroll statement and W-2.  Appropriate taxation amounts are withheld from pay received during September through December for the fall semester, January for J-Term, February through May for Spring Semester, and June through August for Summer Terms.  (It is vital to submit the Tuition Rebate Waiver Form before the first day of the term or semester.)  Any change such as drops, adds, and withdrawals must be reported immediately to Payroll and Student Financial Planning so that proper adjustments may be made to the employee’s salary and withholding records.

High School Students: Post Secondary Enrollment Options (PSEO) Act

This program provides high school students an opportunity to earn college credit while they are still in high school.  The Postsecondary Enrollment Options Handbook can be viewed on the Iowa Department of Education site.

High school students, who are dependents of Drake University employees and eligible to participate in this program, will be required to apply for the PSEO program through their school district when enrolling to take coursework at Drake.  Tuition rebate waiver will be available to these dependents that do not qualify for the PSEO program or after eligibility under the PSEO program has been exhausted.

Fully Disabled, Retired, or Deceased Faculty and Staff

If an employee is either tenured or has been employed for at least five (5) years, their spouse and dependent children can receive the benefits under this policy to which the spouse and dependent children would have otherwise become entitled had the employee not become fully disabled or retired.  The spouse (so long as the spouse does not remarry) and dependent children of a deceased employee can also receive the tuition benefits, under this policy to which the spouse and dependent children would have otherwise become entitled, had the employee not died.

Waiver of Waiting Period

In the event a newly hired employee was eligible for a 100% undergraduate tuition rebate benefit for dependents at another institution immediately prior to accepting employment with Drake, such employee will become immediately eligible for undergraduate tuition rebate for their dependents under this policy at the 100% level.  Eligibility under this waiver provision requires that the following conditions be met:

  1. The employee met all eligibility requirements for tuition rebate at the prior institution of employment, including years of service, employment status and any other condition of eligibility;
  2. The employee produces written documentation of eligibility from the prior institution in the form of a letter from the Director of Human Resources or other person responsible for administration of the tuition rebate policy; and
  3. The employee was employed with the prior institution immediately prior to employment at Drake University (on the day an offer from Drake is accepted the employee must be employed with the prior institution).

Questions

The online application material is available online through the Human Resources website.  Questions about the Tuition Rebate Waiver Program should be directed to Human Resources at 515-271-3133.  Questions about completing the FAFSA should be directed to Student Financial Planning at 515-271-2905.

 

 

Applicable Resources:

Tuition Exchange FAQ

Application