To outline policy for determining federal financial aid eligibility for students who withdraw before the completion of the term.
Definitions:
Official withdrawal
The formal process of withdrawing from all classes before the end of the term.
Return of Title IV (R2T4)
A calculation defined by the U.S. Department of Education to determine aid that must be returned to the department because the student did not fully earn eligibility.
Unofficial withdrawal
Ceasing enrollment in classes before the end of the term without formally withdrawing. This may be indicated by earning all failing grades for the semester.
Withdrawal date
The date on which a student begins the withdrawal process, by either dropping all courses via the Student Center or by requesting to withdraw through a school's or college’s dean’s office.
Scope:
Applies to students who withdraw from classes.
Policy:
Policy Detail
A return-of-Title IV funds (R2T4) calculation must be completed when a student who has received federal Title IV aid withdraws from the term. The calculation determines the type and amount of Title IV aid to be returned to the Department of Education (if necessary).
The federal Title IV financial aid programs included in the R2T4 process are Direct Subsidized and Unsubsidized Loans, PLUS Loans, Perkins Loans, Pell Grants, Supplemental Educational Opportunity Grants, TEACH (Teacher Education Assistance for College and Higher Education) Grants, and Iraq/Afghanistan Service Grants.
The Office of Student Financial Aid (OSFA) completes R2T4 calculations and must return necessary funds within 45 days from the beginning of the withdrawal process for each student.
The federal formula employs the concept that aid is earned in direct proportion to the time enrolled.
For a student who withdraws, the percentage of Title IV aid to be returned is equal to the number of calendar days remaining in the semester divided by the total number of calendar days in the semester.
Scheduled breaks of five or more consecutive calendar days (such as spring break) are excluded from the calculation.
Example: If a student withdraws after completing 25% of the term, they have earned 25% of their federal aid for the term and UW–Madison will return the remaining 75%.
A student who withdraws after 60% of the term has passed is considered to have earned 100% of their federal aid for the term and is not required to return any of their federal aid under the R2T4 formula.
OSFA strongly encourages students to meet with a financial aid advisor to discuss the implications of withdrawing.
Repayment
OSFA takes care of both the amounts to be returned by the school as well as the amount to be returned by the student.
The student is sent a letter detailing the result of the R2T4 calculation and informing them that if a balance is created, they will receive a separate bill from the Bursar’s Office.
UW–Madison satisfies its responsibility by repaying funds in the student’s aid package in the following order:
Direct Unsubsidized Loan
Direct Subsidized Loan
Perkins Loan
Direct Graduate PLUS Loan
Direct Parent PLUS Loan
Pell Grant
Supplemental Educational Opportunity Grant
TEACH Grant
Iraq/Afghanistan Service Grant
Refunds
Per the institution’s tuition refund policy, if a student withdraws from school during the first four weeks of the semester, they will qualify for an adjustment in the amount of tuition and fees paid as follows:
100% tuition and fees refund during 1st and 2nd weeks
50% tuition and fees refund during 3rd and 4th weeks
If the student received federal financial aid for the payment period, the refund will first be used to repay any amounts owed to the aid funds according to the repayment formula. Any refund remaining after the repayment calculation has been satisfied will go to repay aid in the following order:
State grants (Wisconsin Grant, Wisconsin Covenant, Talent Incentive Program, etc.)
Institutional loans
Private loans
Other federal loans (Nursing Student Loan, Health Professions Pharmacy Loan, Health Professions Student Loan)
Institutional grants
Unofficial Withdrawal
If a student leaves school without providing notification, within 30 days of the end of the term, OSFA will determine that the student has officially withdrawn and use the federal formula to determine if funds are required to be returned. These students are identified as those who are federal financial aid recipients and received all non-passing grades for the term – any combination of F, NW, NR, or U.
The student must provide documentation from the instructors of each of their courses, including any dropped classes, verifying the student did participate in the course.
If the student did not complete the class, OSFA asks that the instructor's documentation also include the date the student last participated in academically-related activity. Academically-related activities include attending class, turning in an assignment, completing a quiz or exam, or contacting the instructor about the academic subject studied in the class; it does not include academic advising.
Post-Withdrawal Disbursement
OSFA must disburse or offer to disburse earned financial aid that could have been disbursed prior to withdrawal but was not. “Could have been disbursed” means the student was eligible to receive the aid at the time they withdrew.
If the student is owed a post-withdrawal disbursement, there are various timeframes for making the disbursement depending on the funding source. All post-withdrawal disbursements must be made within 180 days of the date UW–Madison determined the student withdrew (the "date of determination").
Related UW–Madison Documents, Web Pages, or Other Resources:
