Are We Required To Report a Title IV Overpayment Due To a Coronavirus-Related Withdrawal?
This Q&A has been updated to reflect the guidance found in the May 15, 2020 Electronic Announcement.
It depends. Nothing has changed for Title IV overpayments in a payment period or period of enrollment that concluded prior to the declaration of the national emergency on March 13, 2020. If the payment period or period of enrollment ended before that date, an overpayment of Title IV grant funds resulting from the return of Title IV funds (R2T4) calculation still must be processed and reported. Title IV loans are repaid according to the terms of the promissory note and, therefore, are not reported as overpayments.
For any student who begins attendance in a payment period or period of enrollment that begins on or includes March 13, 2020, and who withdraws from that period as a result of COVID-19, neither the school nor the student is required to return unearned Title IV funds. The student therefore does not owe an overpayment and, as noted in the May 15, 2020 Electronic Announcement, the institution "is not required to notify the student or the National Student Loan Data System (NSLDS) of the overpayment or refer any portion of the overpayment to the Department."
If the school has already returned an overpayment on behalf of a student who withdrew from a period that includes March 13, 2020 as a result of COVID-19, the overpayment must be re-disbursed to the student and reversed in NSLDS.
See also AskRegs Knowledgebase Q&As How Do We Determine if a Withdrawal Was the Result of a Qualifying Emergency Due to Coronavirus? and What Is the Definition Of a Qualifying Emergency Under the CARES Act?
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Publication Date: 5/5/2020