Return of Title IV Funds

13.1 Process Overview & Applicability

Students who receive Title IV funds and enroll and then subsequently either withdraw or cease attendance or cease participation in all of their courses or earn all failing and/or W or I grades are reviewed per the R2T4 guidelines. Review and processing of R2T4 is performed by financial aid staff on a regular basis throughout the semester and again at the end of the semester after grades are posted for that semester. A student is considered to have withdrawn from a credit-hour program if the student does not complete all the days in the payment period of period of enrollment they were scheduled to complete. Electronic queries are used in each instance to identify R2T4 candidates. Withdrawal and grade posting activities are done electronically and will create an electronic record that can be searched or queried to generate a list of students subject to the R2T4 processing. This ensures accurate information when calculating R2T4. The R2T4 calculation itself is done in a worksheet within the electronic system. Funds are withdrawn from the student's account electronically and credited to the Dept. of Education in an electronic batch process. A letter or email notifying the student of this action is sent to the student. If necessary, a letter, email or fax may be sent to the loan servicer requesting a 30 day demand be sent to the student who received loans and was found to be ineligible. This student would repay the outstanding loan balance to the federal government via the servicer. Students who have had partial Pell or loan funds returned must pay the GBC Controller's Office for their outstanding debt. An enrollment hold will be placed on a student's record if his account has an outstanding balance. The Controller's Office will release the hold once the balance is paid. GBC post overpayments to NSLDS. If a student is entitled to a post-withdrawal disbursement, the Loan Coordinator calls and then emails the student requesting a response. If none is received after 30 days, the disbursement is cancelled. If the student responds, funds are disbursed or cancelled as indicated by the student. Federal timelines are followed in processing R2T4's as outlined in 34 CFR 668.22. The school has 30 days from determination of the student's withdrawal date to return funds to the Dept of Ed.

Last updated: Dec 2025

Policies

How a withdrawal affects financial aid

Federal regulations require Title IV financial aid funds to be awarded under the assumption that a student will attend the institution for the entire payment period or period of enrollment in which federal assistance was awarded. When a student withdraws from all courses for any reason, including medical withdrawals, he/she may no longer be eligible for the full amount of Title IV funds that he/she was originally scheduled to receive. The return of funds is based upon the premise that students earn their financial aid in proportion to the amount of time in which they are enrolled. A pro-rated schedule is used to determine the amount of federal student aid funds he/she will have earned at the time of the withdrawal. Thus, a student who withdraws in the second week of classes has earned less of his/her financial aid than a student who withdraws in the seventh week. Once over 60% of the semester is completed, a student is considered to have earned all of his/her financial aid and will not be required to return any funds.

Federal law requires schools to calculate how much federal financial aid a student has earned if that student:

• completely withdraws, or
• stops attending before completing the semester, or
• does not complete all modules (courses which are not scheduled for the entire semester or payment period for which he/she has registered at the time those modules began.)

Based on this calculation, Great Basin College (GBC) students who receive federal financial aid and do not complete their classes during a semester or term could be responsible for repaying a portion of the aid they received. Students who do not begin attendance may have to repay all financial aid disbursed for the term.

The following policies will help you to understand that a withdrawal potentially affects students academically as well as financially. We encourage students to read all the information below prior to making a final decision.

R2T4 calculation exceptions

• Great Basin College (GBC) has the option to not perform an R2T4 calculation when a student never began attendance and the student is treated as never having begun attendance. GBC will return 100% of all Title IV grant and loan funds for the period of enrollment and will refund all institutional charges to the student for the payment period. GBC will write off or cancel any balance due by the student to treat the student as never attending that term.
• If the student completes the graduation requirements prior to finishing a semester, no R2T4 calculation will be performed.
• R2T4 calculations are not performed is a student never establishes eligibility for Title IV aid, ie no official ISIR, etc.

How the earned financial aid is calculated

Students who receive federal financial aid must "earn" the aid they receive by staying enrolled and participating in classes. The amount of federal financial aid assistance the student earns is on a pro-rated basis. Students who withdraw or do not complete all registered classes during the semester may be required to return some of the financial aid they were awarded.

Institutions are required to determine the percentage of Title IV aid ''earned" by the student and to return the unearned portion to the appropriate aid programs. Regulations require schools to perform calculations within 30 days from the date the school determines a student's complete withdrawal. The school must return the funds within 45 days of the calculation. The R2T4 calculation process and return of funds is completed by the Financial Aid Office.

For example, if a student completes 35 percent of the payment period, they earn 35 percent of the aid they were originally scheduled to receive. This means that 65 percent of the scheduled awards remain "unearned" and a portion of that amount must be returned to the federal government based on the Department of Education's calculation. Once over 60% of the semester is completed, a student is considered to have earned all of his/her financial aid and will not be required to return any federal funds.

The following formula is used to determine the percentage of unearned aid that has to be returned to the federal government:

• The percent earned is equal to the number of calendar days completed up to the withdrawal date, divided by the total calendar days in the payment period (less any scheduled breaks that are at least 5 days long).
• The payment period for most students is the entire semester. However, for students enrolled in modules (courses which are not scheduled for the entire semester or term), the payment period only includes those days for the module(s) in which the student is registered.
• The percent unearned is equal to 100 percent minus the percent earned.
  

For students enrolled in modules: A student is considered withdrawn if the student does not complete all of the days in the payment period that the student was scheduled to complete. Great Basin College (GBC) will track enrollment in each module (a group of courses in a program that do not span the entire length of the payment period combined to form a term) to determine if a student began enrollment in all scheduled courses. If a student officially drops courses in a later module while still attending a current module, the student is not considered as withdrawn based on not attending the later module. However, a recalculation of aid based on a change in enrollment status may still be required.

Students who provide written confirmation to the financial aid office at the time of ceasing attendance that they plan to attend another course later in the same payment period are not considered to have withdrawn from the term. If the student does not provide written confirmation of plans to return to school later in the same payment period or term, GBC considers the student to have withdrawn and begins the R2T4 process immediately. However, if the student does return to GBC in the same term, even if they did not provide written confirmation of plans to do so, the student is not considered to have withdrawn after all and is eligible to receive the Title IV funds for which the student was eligible before ceasing attendance. The financial aid office will then reverse the R2T4 process and provide additional funds that the student is eligible to receive at the time of return.

Student who do not begin attendance in a course are not considered to have earned any portion of a Pell Grant, SEOG Grant or GBC institutional grant, and 100% of the financial aid money allocated to that course will be pulled back.

Institutional funds are not recalculated based on the pro-rated policy as described for federal financial aid funds.

Steps in the return of Title IV funds policy

Step 1: Student's Title IV information

The financial aid office will determine:

1. The total amount of Title IV aid disbursed for the semester in which the student withdrew. A student's Title IV aid is counted as aid disbursed in the calculation if it has been applied to the student's account on or before the date the student withdrew.
2. The total amount of Title IV aid disbursed plus the Title IV aid that could have been disbursed for the semester in which the student withdrew.

Step 2: Percentage of Title IV aid earned

The financial aid office will calculate the percentage of Title IV aid earned as
follows:

The number of calendar days completed by the student divided by the total number of calendar days in the semester in which the student withdrew. The total number of calendar days in a semester shall exclude any scheduled breaks of more than five days.

Days Attended ÷ Days in Enrollment Period = Percentage Completed

If the calculated percentage completed exceeds 60%, then the student has "earned" all the Title IV aid for the enrollment period.

Step 3: Amount of Title IV aid earned by the student

The financial aid office will calculate the amount of Title IV aid earned as follows:

The percentage of Title IV aid earned (Step 2) multiplied by the total amount of Title IV aid disbursed or that could have been disbursed for the term in which the student withdrew (Step 1-A).

Total Aid Disbursed x Percentage Completed = Earned Aid

Step 4: Amount of Title IV aid to be disbursed or returned

• If the aid already disbursed equals the earned aid, no further action is required.
• If the aid already disbursed is greater than the earned aid, the difference must be returned to the appropriate Title IV aid program.
  Total Disbursed Aid – Earned Aid = Unearned Aid to be Returned
• If the aid already disbursed is less than the earned aid, then the financial aid office will calculate a post-withdrawal disbursement.

Types of Withdrawals

By regulations GBC is an institution that is not required to take attendance for Title IV purposes.

For financial aid purposes, there are two types of withdrawals for R2T4, namely official and unofficial. An official withdrawal is when the student actually withdraws from his/her classes at GBC through MYGBC and People Soft.

Federal financial aid regulations consider a student to be an unofficial withdrawal if the student receives all fail (F) grades or a combination of all fail (F), incompletes (I), Unsatisfactory (U), and withdraw (W) grades for the term.

Determination of the withdrawal date

The withdrawal date used for an official withdrawal in the return calculation of a student's federal financial aid is the date the student began the school's official withdrawal process through the student's MYGBC or the date the student officially notified the school of their intent to withdraw whichever is earlier. The official withdrawal date can be found in People Soft at the following location: Campus Community>Student Services Center> click on the finances tab>click on view student account>click on Academic Information>find the term you are looking for>click on the Enrollment tab. This screen will show you the date each class was added and the date each class was dropped.

If a student stops attending classes without notifying GBC, and or fails to earn any passing grades (unofficial withdrawal) the withdrawal date will be the last date of academic activity entered into People Soft by each instructor or the midpoint of the semester. Additional documentation supporting the last date of academic activity may be provided by the student if they verify a later date of attendance than determined by GBC.

Withdrawing prior to completing more than 60 percent of a term

Unless a student completes more than 60 percent of the term in which federal aid was disbursed, the student will be required to return all or part of the financial aid disbursed in the term. This applies to students who have officially (including medical) or unofficially withdrawn.

When a student fails to begin attendance

If a student receives financial aid, but never attends classes, the Financial Aid Office will return all disbursed federal funds to the respective federal and institutional aid programs. However, if the student received a direct federal loan and the loan was disbursed before the classes started then, GBC will return the loan dollars up to the amount of tuition and fees GBC charged the student for that term. We will notify NSLDS that the student never began attendance. If the direct federal loans were issued after the semester started and the student failed to begin attendance, 100% of the direct federal loan dollars will be returned to the direct federal loan program from which the dollars were borrowed.

When a student fails to earn a passing grade in any class

If the student has not completely withdrawn but has failed to earn a passing grade in at least one class for the term or module, federal regulations require the school to determine whether the student established eligibility for financial aid. Eligibility is based on if the student attended at least one class or participated in any GBC academic-related activity (such as taking an exam, quiz, or turning in a homework assignment. Merely logging in to an online class is not considered academic activity). All disbursed funds must be returned to the respective federal and institutional aid programs if the student cannot prove that he/she began attendance. For more information regarding this topic see the section Students who receive all failing grades at the end of the term.

Students who receive all failing grades at the end of the term

Financial aid is awarded under the assumption that the student will attend Great Basin College (GBC) for the entire term for which federal assistance was disbursed. When the student has failed to earn a passing grade in at least one class for the term, federal regulations require the school to determine whether the student established eligibility for funds disbursed by attending or participating in any GBC academic-related activity. If the school cannot verify that the student participated in an academic related activity at GBC, all financial aid may be repaid to the federal and institutional programs. The student's account may be charged, and the student will be responsible for any balance due.

When the student has a combination of fail and withdraw grades for the term, approximately 50% of the financial aid must be repaid. The student's bursar account will be charged, and the student will be responsible for any balance due.

If the student, after establishing participation in all of their classes can prove to have participated in a GBC class or academic-related activity past the 60% date, the student will not be required to return any disbursed financial aid. The student's account will be updated and the student will be responsible for any other charges that may have been applied to their account.

Students who are able to verify attendance beyond GBC's records may submit supporting documentation to Financial Aid Office. The student must submit supporting documentation within 30 days from the last date of the term. Recalculations for aid eligibility will not be performed for documentation received after that date.

Definition of an academic related activity

Examples of Great Basin College (GBC) academic-related activities include but are not limited to physically attending a class where there is an opportunity for direct interaction between the instructor and students.

Proof of participation:

• Exams or quizzes
• Tutorials
• Computer-assisted instruction
• Completion of an academic assignment, paper or project
• Participating in an online discussion about academic matters
• Initiating contact with a faculty member to ask a question about the academic subject studied in the course
• GBC required study group where attendance is taken

Documentation not acceptable as proof of participation:

• Student's self-certification of attendance that is not supported by school documentation
• Verification of Enrollment form issued by the Registrar's Office
• Living in GBC housing
• Participating in academic counseling or advising

Return of Title IV funds for students enrolled in modules
Effective July 1, 2011

Overview

These new regulations aim to provide for consistent and equitable treatment of students who withdraw from a program measured in credit hours, regardless of whether courses in the program span the entire term or consist of shorter modules.

Program integrity principles

• Title IV funds are awarded to a student to attend an entire payment period or period of enrollment, and the funds are intended to cover the student's educational and living expenses for the entire period.
• Federal law specifies that a student earns Title IV funds on a pro-rated basis through 60 percent of a period based on the actual days completed. For the purposes of federal aid programs, GBC must be able to document a student's active participation in an academic activity.

Regulatory requirements

• A student is considered to have withdrawn from a payment period or period of enrollment in which the student began enrollment if the student ceased attendance in all scheduled courses without completing all of the days the student was scheduled to complete in the period.
• However, if a student provides written confirmation to GBC before ceasing attendance that the student plans to attend another course later in the same period, the student is not considered to have withdrawn. For a nonstandard-term or non-term program, the next course the student plans to attend during the period must begin within 45 days after the end of the course the student ceased or failed to attend in order for the student not to be considered withdrawn. If a student does not resume attendance within the scheduled timeframe, the student is considered to have withdrawn as of the date on which attendance ceased.
• If a student does not provide written confirmation of plans to return to school later in the same period, a school considers the student to have withdrawn and performs a return of Title IV funds (R2T4) calculation to determine if any funds must be returned. However, if the student does return to school in the same period — even if the student did not provide written confirmation of plans to do so — the student is not considered to have withdrawn and is eligible to receive Title IV funds for which the student was eligible before ceasing attendance. GBC must reverse the R2T4 process and provide any additional funds the student is eligible to receive at the time of return.
• The rule impacts all programs offering courses shorter than an entire term, including semester-based programs with a summer term consisting of two consecutive six-week summer sessions.
• Students who do not begin attendance in a course are not considered to have earned any portion of a Federal Pell Grant, Federal Supplemental Educational Opportunity Grant, or Great Basin College institutional grants that may have been disbursed based on enrollment in that course. GBC will pull back all the funds allocated to that course and the student will be responsible for the reimbursement of those funds to GBC.

Repayment calculation of unearned aid as a result of a withdrawal

As a result of a withdrawal, students who received federal funds will be required to repay "unearned" aid. The repayment calculation is performed utilizing the built in R2T4 calculation module in People Soft or the Department of ED's non-year-specific web-based application available via the FSA Partner Connect.

The amount of the assistance earned is determined on a pro-rated basis. For example, if a student completed 40% of the term, they have earned 40% of the assistance they were originally scheduled to receive. Once a student has completed more than 60% of the term, the student earns all the assistance they were scheduled to receive for the term.

Student notification of repayment

A notification letter outlining the amount returned to the federal and institutional program(s) will be mailed to the student's mailing address. GBC will return funds on the student's behalf to the appropriate federal and institutional aid program(s) and subsequently will bill the student's account. A statement reflecting these charges will be sent to the student. The student is responsible for all charges and overpayments resulting from a Return of Title IV calculation.

Order of repayment to federal aid programs

Federal regulations and Institutional policy require that the following aid programs be subject to the repayment calculation if the student did not attend 60% of the term:

• Unsubsidized Direct Loans
• Subsidized Direct Loans
• Direct Parent PLUS Loans
• Federal Pell Grant
• Iraq and Afghanistan Service Grant
• Federal Supplemental Educational Opportunity Grant (FSEOG)

Overpayment of federal grant funds

Federal regulations provide that 50% of the unearned amount of all federal grants is protected by the federal calculation (see steps 9 and 10 of the federal government's repayment worksheet). Any grant amount subject to repayment will be billed to the student's account as GBC will return the funds to the appropriate grant program(s).

Additional loan information to consider when withdrawing

The federal repayment calculation also has additional loan amounts that the student and parent may be responsible to return directly to the U.S. Department of Education (see step 8 of the federal government's repayment worksheet).

Important: Anytime a student is enrolled less than part-time the grace period begins. The student's grace period for loan repayments for Federal Direct Unsubsidized and Subsidized Loans will begin on the day of the withdrawal from the school. If the student is not enrolled part-time for more than 6 months, the loans will go into repayment. The student must contact the U.S. Department of Education (ED) or his/ her lender(s) to make payment arrangements. Loans must be repaid by the loan borrower (student/parent) as outlined in the terms of the borrower's promissory note. The student should contact the lender if he/she has questions regarding their grace period or repayment status.

School and student responsibility for return of unearned federal funds

The student and the school are both responsible for returning unearned federal financial aid to the federal government. The student will be billed for any amount due as a result of the return of federal aid funds (R2T4) calculation.

Repayment of unearned funds

The Financial Aid Office will notify students if they owe federal funds back to the U.S. Department of Education (ED). Amounts that must be returned by the student will first be applied to federal loans. If GBC is required to return loan funds on behalf of the student based on the R2T4 calculation, the student will owe GBC the amount returned. The remaining balance of the student/parent loans will be permitted to repay loans based on the terms of the Master Promissory Note (MPN) which usually consists of scheduled payments to the holder of the loan over a period of time. Any grant overpayment the student has to return to the federal government must be repaid within 45 days after the student receives notification from Financial Aid Office. If the grant overpayment cannot be paid in full, a repayment plan may be arranged with Great Basin College or the U.S. Department of Education depending on to whom they owe the money.

Students will also receive notice from Financial Aid Office regarding repayment of institutional funds. If the student owes any money to the GBC resulting from the return of federal or institutional funds, the student will be billed by GBC's Controller's Office.

Consequences of non-repayment

If a student does not repay the grant funds that are owed to the government within 45 days, the account will be turned over to the U.S. Department of Education (ED) as an overpayment of federal funds. Students who owe an overpayment of Title IV funds are ineligible for further disbursements from federal financial aid programs at any institution until the overpayment is paid in full or payment arrangements are made with the U.S. Department of Education.

If a student does not pay funds due to GBC to cover their balance on their account, the student's records will be placed on financial hold. This means he/she will not be permitted to register for classes or receive transcripts until the balance is paid.

School and Student responsibilities in regard to the R2T4 policy & process

Great Basin College's responsibilities in regard to the Return of Title IV funds

1. Providing each student with the information given in this policy;
2. Identifying students affected by this policy and completing the Return of Title IV Funds (R2T4) calculation;
3. Informing the student of the result of the R2T4 calculation and any balance owed to GBC as a result of a required return of funds;
4. Returning any unearned Title IV aid that is due to the Title IV programs and, if applicable, notifying the borrower's holder of federal loan funds of the student's withdrawal date;
5. Notifying student and/or Plus borrower of eligibility for a Post-Withdraw Disbursement, if applicable.

Student's responsibilities in regard to the Return of Title IV funds

1. Becoming familiar with the Return of Title IV Funds (R2T4) policy and how withdrawing from all courses effects eligibility for Title IV aid;
2. Resolving any outstanding balance owed to GBC resulting from a required return of unearned Title IV aid;
3. Resolving any repayment to the U.S. Department of Education as a result of an overpayment of Title IV grant funds.

How institutional aid is affected by a withdrawal

All institutional aid provided by Great Basin College is based on need or non-need and academic achievement. Any change in enrollment status may cause the amount of the award to be recalculated. A drop in enrollment to 0 units could require the funds to be repaid up to 100% of the disbursed amount.

How a withdrawal affects future financial aid eligibility

Refer to GBC's Financial Aid Office Satisfactory Academic Progress Policy to determine how a withdrawal will impact future financial aid eligibility.

For More Information Contact

Student Financial Services
Berg Hall
Great Basin College
Phone: 775.327.2095

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Why Great Basin College

Great Basin College offers associate and baccalaureate level education in academic, career and technical fields. Welcoming students from all corners of the country, both online and at our various campuses and centers, GBC's presence extends across two time zones and spans more than 86,000 square miles throughout Nevada. A leader in rural higher education, GBC takes pride in developing students who are well-prepared to meet the demands of industry and who contribute to the success and prosperity of the local economy.