Using your USC education benefits

photo of students on campusWorking at a major private research university has many educational perks, like the abundance of free lectures, concerts, and other campus events that are open to all of us as faculty and staff. The Employee Gateway lists many of these every day!

Another perk is that USC employees, by virtue of the university’s status as a nonprofit tax-exempt organization, may qualify for public service student loan forgiveness.

Some specialized employees (like nurses, for instance) are eligible for some reimbursement for job-related coursework offered by accredited schools.

And staff may take job-related coursework at USC if tuition is paid by their department, or they may take a class for audit if approved by the academic department in question. (There’s a form for that.)

But the educational benefit that most full-time faculty and staff most appreciate is Tuition Assistance – the benefit that allows us (or our children) to earn one USC degree 100% tuition-free (and spouses 50% tuition-free). Here’s what you need to know to access this benefit.

Preparing for admission to a degree program

USC is hard to get into! The university is very selective in admissions. Faculty or staff who wish to be accepted into a degree program should consult with the Office of Admissions, or an academic advisor in the school where they would like to enroll. Faculty should also consult with the Office of the Provost.

Staff wishing to earn an undergraduate degree may wish to consider beginning their collegiate studies at a community college and apply as a transfer student to USC. More information is available at the Transfer Applicants website.

Employees wishing to earn a graduate degree should consult the Graduate Admission website.

For our children, USC offers a comprehensive website loaded with information on how to prepare for USC (or other college) admission, beginning as early as 8th grade. In addition, Admissions offers regular sessions for employees on how to help children prepare for higher education, understanding financial aid, and other college-related topics. These sessions are always announced on the Employee Gateway.

Applying for admission

The university does not waive any application fees for employees or their children.

Acceptance

Employees

If you are accepted into a USC degree program, that program will be 100% tuition-free as long as you remain a benefits-eligible, full-time employee. You’re allowed a maximum of 6 units per semester or summer term, of which no more than 4 may be at the graduate level. You must submit a Tuition Assistance (faculty) form, a Tuition Assistance (staff) form, or a Tuition Assistance ROTC/Hebrew Union Employee form before the start of every semester (including summer sessions).

Children

If your child is accepted into a USC degree program, that program will be 100% tuition-free as long as you remain a benefits-eligible, full-time employee; the child has not already used Tuition Assistance toward another degree (the benefit only applies to one degree, and is capped at 144 undergraduate or 72 graduate units, unless enrolled in a progressive degree program that joins a bachelor’s and master’s degree in the same or different departments); the child is under age 35; and, in the case of children of staff, the employee has completed at least 2 years of service. Children must submit a Tuition Assistance (child/spouse) form before their first semester.

Spouses

If your spouse is accepted into a USC degree program, that program will be 50% tuition-free as long as you remain a benefits-eligible, full-time employee – and your spouse has not already used Tuition Assistance toward another degree (the benefit only applies to one degree, and is capped at 144 undergraduate or 72 graduate units, unless enrolled in a progressive degree program that joins a bachelor’s and master’s degree in the same or different departments). Spouses must submit a Tuition Assistance (child/spouse) form before their first semester.

Other educational costs

In all cases and under every circumstance, Tuition Assistance is strictly limited to tuition payments and does not cover room, board, books, any additional fees, or any other expenses associated with a degree program. Speaking of additional fees…

Student Health Center and Student Health Insurance

All USC students, whether employees or not, are charged a mandatory Student Health Center fee. This fee cannot be waived.

All USC students, whether employees or not, are also charged a mandatory Student Health Insurance fee. This fee can be waived simply by proving that you already have adequate health insurance coverage. As USC employees, you and your children likely qualify for this waiver.

Taxes

Employees and spouses

Tuition Assistance is generally considered taxable and reportable income. The gross amount of the benefit will be divided into three portions, added to the employee’s monthly pay and taxed accordingly. This may significantly affect net pay in the applicable months. See Tuition Assistance tax schedule, below. If an employee is enrolled in a graduate program and his/her supervisor certifies that the coursework is job-related, non-taxable Tuition Assistance may be available.

Children

Tuition Assistance granted for undergraduate work is not taxable if child qualifies as the employee’s dependent under applicable IRS provisions. The employee must certify this by completing a Tuition Assistance Dependent Child Certification form at the beginning of each calendar year. If this form is not completed, all Tuition Assistance will be considered taxable and reportable income, subject to the tax schedule below. All graduate coursework is considered taxable and reportable income and will be subject to the tax schedule below.

Tuition Assistance tax schedule

  • Fall semester – taxed October, November and December
  • Spring semester – taxed February, March and April
  • Summer sessions – taxed July, August and September

Changing employment status while using Tuition Assistance

Employees are responsible for immediate payment to the university of any prorated amount of Tuition Assistance if a post-registration audit reveals that their employee status changed during the semester or summer session in which they received the benefit, or if it is found that any Tuition Assistance was applied to ineligible tuition or fees, or the maximum allowed units was exceeded. Please note that the first and last day of classes in any session, including summer courses, is defined by the university’s academic calendar.

The official Tuition Assistance Benefit Program Document

It’s a good idea to review this, especially if you worked for USC before July 1, 2011, when the Tuition Assistance program underwent some changes. The program document contains information on employees who are grandfathered into Tuition Assistance for their children due to completing 15 years of service. In some cases, these children can still access Tuition Assistance even if the employee no longer works for USC. If you fall into that category, you’ll need the Child of Employee with 15+ Years form.

Alternative education benefit for your child

Your university employment may provide your child an alternative to a USC degree. Every child who is eligible for Tuition Assistance is also eligible to compete for scholarships in the Tuition Exchange program, which is not a benefit, strictly speaking, but a selective and competitive scholarship program that allows children to earn their degree from another institution at greatly reduced cost.

Tuition Exchange is a nonprofit association of 600+ schools, of which USC is a member, that administers this reciprocal scholarship program for children of eligible employees at participating institutions (see the Tuition Exchange website for complete list of schools).

Scholarships generally cover 75-100% of tuition costs; a few member schools may also cover some other costs (housing, etc.). Each year Tuition Exchange establishes a minimum dollar value that each participating school must provide, and the Tuition Exchange website details the programs offered by each institution. Scholarships are primarily for undergraduates seeking their first bachelor’s degree, and are awarded based on policies set by each member school.

USC’s Tuition Exchange scholarships are awarded for 8 semesters (or until a degree is earned, whichever comes first). They are renewed each year dependent upon satisfactory academic progress, good conduct, and continued parental benefit eligibility.

By accepting a Tuition Exchange scholarship at any given school, the student is committing to completing his/her degree at that school and is not eligible for Tuition Assistance at USC either during or after enrollment at the Tuition Exchange school. This means that students who begin a degree program with a Tuition Exchange scholarship will not be eligible for Tuition Assistance should they later transfer to USC. Similarly, students who have already received USC’s Tuition Assistance benefit are not eligible for a Tuition Exchange scholarship.

The Tuition Exchange program is a balance of “exports” (children of USC employees looking for scholarships elsewhere) and “imports” (children of other college employees looking for USC scholarships). USC is subsidizing the imports – paying for the scholarships provided to children of employees from other colleges. In exchange, the other institutions are subsidizing the exports – paying for the scholarships provided to children of USC employees. Because of these commitments, if your export stops using Tuition Exchange at another school for any reason, including because he/she is accepted to and obtaining a degree from USC, USC is still obligated to continue paying for the scholarship provided to the matching import who is already studying here. Providing Tuition Assistance to your export, in this case, would mean the university is paying tuition in two places for your child – and that will not be allowed.

Depending on the number of requests for Tuition Exchange, a lottery system may be used to determine the number of applications that will be allowed from children of USC employees. This is because the number of “exports” must balance with the number of “imports.”

To apply for Tuition Exchange scholarships

Study the Tuition Exchange website and determine which schools are of interest to your child; he/she must apply for admission to each school of interest. The most valuable feature on the website is “conducting a school search” which features important deadlines for each member school, whether the scholarship is reserved for freshmen only, and the percentage of applicants who are awarded the scholarship. You’ll also be able to determine whether each school covers full tuition or a lesser amount, whether they cover other types of expenses, and if the award can be applied to study abroad programs.

Admission decisions are made without reference to financial need or to Tuition Exchange eligibility, but applicants are encouraged to apply for admission as early as possible since scholarships are competitive and limited. You will likely not receive a Tuition Exchange scholarship decision until after admission has been granted.

BEFORE OCTOBER 1 OF YOUR CHILD’S SENIOR YEAR IN HIGH SCHOOL (or the year before his/her anticipated fall enrollment, if not currently in high school), submit a Tuition Exchange application. NOTE that applications are only accepted from June 1 to October 1 each year. The application will be posted on this site as of June 1, 2014 again. Also note that you can’t submit a Tuition Exchange application until Benefits has a certified copy of your child’s birth certificate on file.

If after submitting the initial Tuition Exchange application a family wishes to add another school for Tuition Exchange consideration, email the Tuition Exchange liaison as soon as possible. If students fail to apply for admission to a school that they’d listed on the initial Tuition Exchange application, the family should immediately contact the liaison so those applications can be rescinded. Keep the liaison informed of admission status at each school and of any direct contact with Tuition Exchange liaisons from other schools.

The Tuition Exchange acceptance process generally begins in March for freshman applicants. Each school will make its own independent decisions regarding Tuition Exchange awards based on an evaluation of the applicant’s academic merit. The schools will then notify USC and the student. Students are encouraged to commit to universities as early as possible so that the university can balance its imports and exports.

Changing lives

That’s what USC’s educational benefits do. But don’t take our word for it…