Concept: Return of Title IV Funds (R2T4)

R2T4 calculation is based on the percentage of the payment or enrollment period that the student completed or was scheduled to complete. The calculation compares the amount of Title IV aid earned to the amount disbursed, then determines whether the Department of Education (ED) should receive unearned funds, or if the student is eligible for a post-withdrawal disbursement.

Your institution’s academic calendars and noninstructional days directly affect R2T4 calculations. Workday calculates total instructional days for R2T4 based on the standard start and end dates for an academic period or module, minus noninstructional days. You can set custom start dates, end dates, and noninstructional days when you complete the R2T4 worksheet. Note that an academic period’s start and end dates may differ from course section start and end dates based on your course section configuration.

Noninstructional days include weekends, holidays, and scheduled breaks of 5 days or longer (including adjoining weekend days). See Create Holiday Calendars and Steps: Set Up Academic Calendars.

If your institution offers weekend classes, you can designate Saturday and Sunday as instructional days. Workday then excludes your selected weekend days as part of scheduled breaks. See Maintain Federal Student Aid Program Policies.

Example: Alma Mater University observes the Thanksgiving holiday from Wednesday through Friday each year, but because AMU offers classes on Saturday, Workday doesn’t include this short break in R2T4 calculations because it’s less than 5 days.

An R2T4 worksheet helps you calculate the amount of unearned funds to return to ED after a student withdrawal. After R2T4 calculation, your institution must return unearned Title IV funds within 45 days of the withdrawal date or date of determination, whichever’s later. See Set Up Return of Title IV Worksheets.

If a student owes an overpayment of a Title IV grant, you must notify the student in writing within 30 days of their date of determination.

When the amount of Title IV aid disbursed is less than the amount of Title IV aid earned, a student may be eligible for a post-withdrawal disbursement. Per ED policy, the student must attend at least 60 percent of scheduled days in a standard academic period to be entitled to receive 100 percent of the financial aid.

If your institution owes a student a post-withdrawal disbursement, you must follow these compliance timelines:

For Title IV loan funds, your institution must offer the student a post-withdrawal disbursement within 30 days from the date of determination.
Your institution must provide the student or parent at least 14 days to accept the post-withdrawal disbursement.
After accepting the post-withdrawal disbursement, your institution must disburse the loan funds to the student within 180 days from the date of determination.
For Title IV grant funds, your institution must notify the student of a post-withdrawal disbursement within 30 days from the date of determination. Disbursement of grant funds doesn’t require student or parent acceptance.
If paid directly to the student, your institution must disburse grant funds within 45 days from the date of determination.
If paid for allowable charges on the student’s account, your institution must disburse grant funds within 180 days of the date of determination.

The

Post-Withdrawal Tracking Sheet

tab on a student's Return of Title IV worksheet helps you calculate undisbursed financial aid after their withdrawal. If a student has earned funds that haven't been disbursed, this tab shows how much the student will receive as part of their post-withdrawal disbursement. See Steps: Return Title IV Funds.